Studying abroad can be a costly affair, and many students in India may not be able to afford the expenses on their own. This is where education loans come in. Education loans are financial aids that students can avail of to pay for their education expenses, including tuition fees, accommodation, and other related costs. We are providing some reference information, this may not be fully accurate, so please consult your financial advisor and bank for accurate information. In this article, we will take a closer look at education loans for Indian students looking to study abroad.
Types of Education Loans: There are two types of education loans for Indian students:
Secured Education Loans: Secured education loans are the loans that are backed by collateral or security. The collateral can be a property, fixed deposit, or any other asset. The interest rates for secured education loans are generally lower than unsecured loans.
Unsecured Education Loans: Unsecured education loans are the loans that are not backed by any collateral or security. The interest rates for unsecured loans are generally higher than secured loans.
Eligibility Criteria: To be eligible for an education loan, you need to meet the following criteria:
Age: The applicant should be between 18 to 35 years of age.
Educational Qualification: The applicant should have a confirmed admission letter from a recognized university/institution for a course.
Co-applicant: The applicant needs to have a co-applicant, who is usually a parent or guardian.
Income: The applicant or the co-applicant should have a steady source of income to repay the loan.
Loan Amount: The loan amount varies depending on the course and the country of study. Typically, the loan amount can be up to INR 20 lakhs for studying in India and up to INR 1.5 crores for studying abroad.
Interest Rates: The interest rates for education loans in India vary from bank to bank. Generally, the interest rates for secured loans range from 7.5% to 10%, while the interest rates for unsecured loans range from 11% to 14%.
Repayment Schedule: The repayment schedule for education loans varies from bank to bank. Generally, the repayment period for secured loans is longer than unsecured loans. The repayment period can range from 5 to 15 years.
Tax Benefits: Under Section 80E of the Income Tax Act, the interest paid on education loans is eligible for tax deduction. The tax deduction is available for a maximum of 8 years or until the loan is fully repaid, whichever is earlier.
Top Banks Offering Education Loans for Studying Abroad:
Here are some of the top banks in India offering education loans for studying abroad:
State Bank of India (SBI)
Loan amount: Up to Rs. 1.5 crores for studying abroad
Interest rate: 7.45% - 9.05%
Repayment period: Up to 15 years after course completion
Eligibility: Indian nationals between the ages of 16-35 years who have secured admission into a recognized foreign university or institution
HDFC Bank
Loan amount: Up to Rs. 20 lakhs for studying abroad
Interest rate: 8.75% - 10.45%
Repayment period: Up to 15 years after course completion
Eligibility: Indian nationals between the ages of 18-35 years who have secured admission into a recognized foreign university or institution
Axis Bank
Loan amount: Up to Rs. 75 lakhs for studying abroad
Interest rate: 8.55% - 10.5%
Repayment period: Up to 15 years after course completion
Eligibility: Indian nationals between the ages of 18-35 years who have secured admission into a recognized foreign university or institution
ICICI Bank
Loan amount: Up to Rs. 50 lakhs for studying abroad
Interest rate: 8.25% - 11.5%
Repayment period: Up to 10 years after course completion
Eligibility: Indian nationals between the ages of 18-35 years who have secured admission into a recognized foreign university or institution
Bank of Baroda
Loan amount: Up to Rs. 80 lakhs for studying abroad
Interest rate: 6.85% - 8.85%
Repayment period: Up to 15 years after course completion
Eligibility: Indian nationals between the ages of 18-35 years who have secured admission into a recognized foreign university or institution
Punjab National Bank (PNB)
Loan amount: Up to Rs. 20 lakhs for studying abroad
Interest rate: 7.2% - 9.2%
Repayment period: Up to 15 years after course completion
Eligibility: Indian nationals between the ages of 16-45 years who have secured admission into a recognized foreign university or institution
Here are some more tips for students seeking education loans from India for studying abroad:
Documentation: While applying for an education loan, make sure you have all the required documents in place. Some of the commonly required documents are:
Admission letter from the university or college abroad
Fee structure of the course
Academic records (mark sheets and certificates)
Identity proof (such as Aadhar card, passport, or driving license)
Address proof (such as a utility bill or rental agreement)
Income proof of the co-applicant (such as salary slips, ITR, or bank statements)
Collateral documents (such as property papers)
Interest rate: The interest rate on education loans from India can vary depending on the bank or lender, the loan amount, and the repayment tenure. Generally, the interest rates range from 8% to 15%. It is advisable to compare the interest rates offered by different lenders and choose the one that suits your budget.
Repayment: The repayment of an education loan from India usually starts after the completion of the course or after six months to one year of getting a job, whichever is earlier. The repayment tenure can vary from 5 to 15 years, depending on the loan amount and the lender. It is important to plan your finances and choose a repayment plan that is comfortable for you.
Loan amount: The loan amount that can be availed for studying abroad varies from lender to lender. Generally, the loan amount can range from Rs. 20 lakhs to Rs. 1.5 crores. However, the loan amount can also depend on various factors such as the cost of the course, the duration of the course, and the collateral provided.
Collateral: In most cases, education loans from India require collateral. The collateral can be in the form of property, fixed deposits, or any other tangible asset that has a value equivalent to the loan amount. It is important to understand the collateral requirements of different lenders and choose the one that suits your needs.
Prepayment: Most lenders allow prepayment of education loans without any penalty. This means that if you have extra funds, you can prepay the loan and reduce the interest burden. It is important to check the prepayment terms and conditions of different lenders before availing of the loan.
In conclusion, education loans from India can be a great option for students seeking financial assistance for studying abroad. It is important to choose the right lender, understand the terms and conditions of the loan, and plan your finances accordingly. With proper research and planning, you can make your study abroad dream a reality.
These are just a few examples of the banks that offer education loans for studying abroad. Each bank has their own set of eligibility criteria, interest rates, and repayment schedules, so it's important to do your research and compare different options before making a decision. Processing Time The time required to process education loans can vary from bank to bank and depends on various factors such as the amount of loan, collateral provided, and the bank's internal policies and procedures. Typically, the processing time can range from a few days to a few weeks.
Some banks may offer quick processing for smaller loan amounts or loans without collateral, while others may require a longer processing time for larger loan amounts or loans with collateral. It is important for students to plan ahead and apply for loans well in advance to avoid any delays in their education plans.
It is also recommended that students research and compare loan options from multiple banks to find the best interest rates, repayment terms, and processing times that suit their needs.
These are just indicative details, please consult with your financial advisor and relevant bank to get more accurate information, as the information here may not be fully updated.
Comments