Education Loans in India

A good education can often be the gateway to success in life. Pursuing higher education in universities abroad gives a good opportunity for better job placements. This opportunity is also seen as a great learning experience in many fields.

No wonder, in the year 2017-18 close to 8 lakh Indian students went abroad for higher studies

The cost of education together with living expenses abroad comes up to a huge sum which is a big worry for all throes dreaming of studying abroad. That is where an educational loan comes handy

Almost all banks and many NBFCs and fintech lenders are providers of education loans in India. We bring you a list of some of the top educational loan providers for studies abroad.

Main Features of Education Loans in India

  • The amount of the loan offered as an education loan can vary between Rs 4lakh to Rs 40 lakhs. Amounts higher than these can also be allowed on a case-to-case basis.
  • Any individual in the age group of 18-35 can avail of an education loan for studying abroad.
  • management, architecture, arts, fashion, law, etc.These loans can be availed for studying a wide range of subjects like science,
  • As the primary applicant of the loan may not be earning, a co-applicant (either a parent, sibling or any close relative) is needed for the sanction of the loan.
  • The credit score of the co-applicant is taken into consideration for allowing the loan.
  • A margin amount of 5 -15% may be required to be catered by the applicant.
  • An Educational loan covers expenses right from tuition fees, cost of books, food and accommodation, lab and library fee, travel expenses, expenses for a study tour, etc.
  • An education loan comes with a moratorium period until the completion of the studies. During this time, only simple interest is chargeable on the loan amount. The applicant will need to pay only the interest during this period
  • The tenure of an education loan can extend up to 15 years including the period of moratorium depending upon the policies of the lende
  • The interest paid on an education loan EMI gets Income Tax deduction under Sec 80E.

Top 6 Banks Education Loan Providers in India

Educational loans come under priority sector lending, so all banks do have packages for educational loans.

1. Education Loan Provider - State Bank of India

SBI offers education loans for students desiring to pursue higher education both in India and abroad. Depending on the amount of the loan required, there are 2 types of education loans from SBI.

Student Loan Scheme

Loans for up to amounts of Rs 20 lakh are available under this scheme. The details of the scheme are as below:

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Rs 20 lakhs 15 yrs excluding moratorium of 1 yr For loans up to Rs 4 lakh -Nil Above 4 lakh- 5% for studies in India or 15% for studies abroad 10.05% fixed Nil for loans upto Rs 20L
SBI Global Ed-vantage

This is a loan exclusively available for students wishing to pursue higher studies abroad.

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Rs 20 L - Rs 1.5 cr 15 yrs excluding moratorium of 1 yr and course period Needed on a year-on-year basis 10.05% fixed Rs 10,000

Girl applicants will get a rebate of 0.5% on the interest rate on both the schemes. Collateral requirement for loans above Rs 7.5 lakhs.

2. Education Loan Provider - HDFC Bank

HDFC education loan comes with attractive terms and conditions as below.

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Rs 20 lakhs Up to 15 yrs excluding moratorium of 1 yr For loans up to Rs 4 lakh -Nil Above 4 lakh- 5% for studies in India or 15% for studies abroad 9.55 -13.25% Rs 1000 or 1% of the loan, whichever is higher

For loans above Rs7.5 lakhs collateral is required.

3. Education Loan Provider - ICICI Bank

To help many students fulfil their dream of getting a higher degree, ICICI Bank allows education loans. ICICI bank allows loans even for Undergraduate students abroad.

For Undergraduate Studies:
Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Rs 50 lakh for courses in India and Rs 1 crore for those abroad 5yrs for loans without collateral and 7yrs with collateral No margin for loans upto Rs 20 lakh. 5-15% for those above Rs 20lakh Starts from 11.75% 1% of the loan amount plus taxes
For Post graduate Studies:
Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Rs 50 lakh for courses in India and Rs 1 crore for those abroad 6yrs for loans without collateral and 8yrs with collateral No margin for loans up to Rs 20 lakh. 5-15% for those above Rs 20lakh Starts from 11.25% 1% of the loan amount plus taxes

Collateral-free loans for select institutes: Up to Rs 20 lakh for UG and up to Rs 40 lakh for PG courses.

4. Education Loan Provider - Axis Bank

Axis Bank brings you Education Loans for studies both in India and abroad starting from Rs. 50,000 at attractive interest rates. The loan is available in different variants to suit the needs of individuals.

Variant Maximum Amount Tenure of the Loan
PRIME ABROAD Rs 40 lakh 15 years
PRIME DOMESTIC Rs 40 lakh 15 years
Loan for working professionals Rs 20 lakhh 10 years

Rate of Interest: Up to Rs 4L - 15.2%, 4 - 7.5 L - 14.7%, Above Rs7.5L - 13.7%

Processing Fee : Nil up to Rs 10 lakh, Rs 15000+GST for amounts up to Rs 20 L, 0.75% of differential loan amount above 20 lacs + GST

Education Loan Provider - PNB for Study Abroad

Punjab National Bank runs a scheme called PNB Udaan to provide education loans for students looking to pursue higher education abroad

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Need-based finance based on repayment capacity 15 years No margin for loans up to Rs 4 lakh. 15% for those above Rs 4lakh Floating Rate based on Repo Rate Up to Rs7.5L-9.05% Above 7.5L -9.75% 1% of the loan with a minimum of Rs 10000

Top 5 Indian NBFCs Providing Education Loan to Study Abroad

Other than banks there are many NBFCs that offer education loans for higher studies abroad. Quite often, education loans from NBFCs come with easier eligibility conditions.

Also, NBFCs are more open to lending for courses other than the ones in the mainstream. Processing of loans may also be faster when you avail of education loans from NBFCs. But they may look for more collateral depending upon the credit score and the course you are trying to pursue

NBFCs do not allow moratorium on the payment of EMIs on education loans and carry a higher rate of interest than the banks.

NBFCs do not allow moratorium on the payment of EMIs on education loans and carry a higher rate of interest than the banks.

1. Education Loan Provider - Avanse

Established in 2013, Avanse is a new-age education loan provider who looks to make seamless loans to those Indian students looking to study abroad. Details of the educational loans by Avanse are:

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Need-based Starting from Rs 1lakh 10 years including course tenure No margin required Avanse Base Rate +Spread Depends on your credit profile and the course undertaken 1-2% of the loan amount decided on a case to case basis

Collateral requirement depending upon the loan amount and other factors.

2. Education Loan Provider - HDFC Credila

HDFC Credila is India’s first dedicated education loan which was formed with a view of enabling students to fulfil their aspirations of higher education abroad. Loan approval from Credila is available even before getting confirmed admission.

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Need-based Starting from Rs 1lakh 12 years No margin required Credila Benchmark Lending (12.55% current) Rate+Spread Depends on your credit profile, collateral offered, the course undertaken, etc 1-1.25% of the loan amount decided on a case to case basis
3. Education Loan Provider - Tata Capital

Tata Capital is another well-known NBFC that is into lending educational loans for higher education abroad

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Rs 75000-Rs 25 lakhs 6 years No margin required 10.99% onwards Up to 2.75% of the loan amount
4. Education Loan Provider - Auxilo

Auxilo is a new entrant to the education loan space but has made a name by lending out educational loans to many students. The main features of Auxilo education loan are:

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged
Based upon the needs of students 10 years No margin loans are available Auxilo base interest rate (12.7% current)+ a spread Depends on your credit profile, collateral offered, the course undertaken, etc Up to 2% of the sanctioned loan amount

Loans without collateral are also available. However, if collateral is provided, you can avail attractive rates of interest offered exclusively for collateral backed loans.

5. Education Loan Provider - InCred

InCred is an NBFC that allows education loans to all aspiring students. The details for their loans for studies abroad are as follows:

Maximum Amount Tenure of the Loan Margin Requirement Rate of Interest Processing Fee Charged

Rs 1 crore (Secured )

Rs 40 lakh (unsecured)

10-15years No margin loans are available 12% onwards Depends on your credit profile, collateral offered, the course undertaken, etc 1-1.5% of the sanctioned loan amount

If you provide collateral for an InCred education loan, then you may typically get a better rate. Also, you may qualify for a higher loan amount as well as improve your chances of loan approval in certain cases.

Money View Instant Personal Loan As a Education Loan

Though there are many education loans available in the market, there may be times when you are not able to get an educational loan or it falls short. At those times, your parents, siblings, spouse or any earning member of your family can avail of Money View instant personal loan as a substitute for an education loan or to supplement your education loan amount.

Availing a Money View online instant personal loan is an easy process

The entire process right from application to disbursal happens online so that you do not have to make numerous trips to banks/financial institutions. Moreover, we have an in-house credit assessment model which takes into consideration many more factors than a credit score to assess your creditworthiness.This allows many more people to avail of our loans.

Download the Money View app or apply now on our website today!