How important is it for you to choose a product best suited to your needs? How important is it to find the perfect product for you instead of picking a random one in the market? Now think about your education loan. Do you think it is important to choose the right loan scheme to finance your abroad education loan? You must think carefully about it, right? 

Education holds the greatest significance in our lives. Students like you have vivid dreams of studying abroad and building successful careers for yourselves. Education loans act as a spark to your fuel by funding your course and expenses. But with many loan schemes in banks out there, it is natural to feel confused about what would be the best one for you. And that’s okay. Let us now get clarity about the same. 

In this article, we shall know:

  • What an education loan scheme is.
  • Which banks have abroad education loan schemes
  • Details of the schemes.

WHAT ARE ABROAD EDUCATION LOAN SCHEMES?

Banks have specific products or loan packages that are designed to suit the needs of students flying abroad to study. They are called “Schemes” or “Loan Schemes”. These loan schemes include the loan amount, rate of interest, repayment details, and other information the student requires when considering an education loan for abroad studies. In this article, we will explore the loan schemes that public banks have to offer and their particulars.

Public banks have loan schemes and they have their names for the schemes. While private banks and NBFCs do not have any schemes, they have “Loan Products” which have details about loan amount depending on various factors like university ranking, academics of the applicant, profile of the co-applicant, and financial co-applicant and the type of course the student chooses to pursue.

 

ABROAD EDUCATION LOAN SCHEMES BY PUBLIC BANKS

Public banks are financial institutions that are owned and operated by the Government of India and work to serve public interests, unlike private banks that are profit-driven.

Some well-known public banks are:

Let us take a look at their loan schemes now beginning with SBI.

SBI ABROAD EDUCATION LOAN SCHEMES

SBI EDUCATION LOAN SCHEME

SBI Abroad Loan Education Scheme is for students who are going for higher studies in India and abroad. 

LOAN PARAMETERS DETAILS
Maximum loan amount  7.5 lakhs
The effective rate of interest
  • 11.15%
  • 0.5% concession for female students.
  • 0.5% concession for all students who avail of SBI Rinn Raksha. 

*Interest rate is floating according to changes in the repo rate.

SBI GLOBAL ED-VANTAGE SCHEME

The SBI Global Ed-vantage scheme is specially designed for students going abroad for their higher studies in full-time regular courses. Do you know the top courses students opt for studying abroad and why banks love to fund such courses?  Click here and read about the top courses for abroad education and the top countries too.

The scheme details are as follows:

LOAN PARAMETERS DETAILS
Maximum loan amount Above 7.5 lakhs up to 1.5 crores
The effective rate of interest
  • Male-10.65%
  • Female-10.15%

(After taking Rinn Raksha)

*Interest rate is floating according to changes in the repo rate.

MORE DETAILS:

For both schemes, some things are the same. They are:

MORE DETAILS
Loan margin: 10%
Repayment tenure: Up to 15 years.
Simple interest will be charged during the course period and moratorium.
Expenses covered in the loan: Tuition fee, Travel expenses, and miscellaneous expenses as long as they do not exceed 20% of tuition fees.
The security deposit should not exceed 10% of the tuition fee.
  • The processing fee is 10,000 rupees + 1800 GST
  • The legal and valuation fee is approximately 7500 rupees.
  • Accepted collateral: Tangible collateral security is accepted.
  • Collateral security offered by Third Parties (other than parents) can also be accepted.

BANK OF BARODA ABROAD EDUCATION LOAN SCHEMES

Baroda Scholar is the foreign education loan scheme that the Bank Of Baroda offers. It is given for MBA, MCA, MS, and other approved courses that create jobs and employment. Bank of Baroda has a list of premier and non-premier institutions which is standard for them to decide loan amounts, interest rates, and margins. You should read our Bank Of Baroda Education loan to know more about their abroad education loan product.

Who doesn’t like products that come with a lot of pros? Everyone does. Baroda Scholar is a loan product that has some awesome features like:

  • No loan margin up to 4 lakhs.
  • The decent rate of interest starts from 9.7%.
  • No processing fees up to 7.5 lakhs 
  • No documentation charges at all

Let us look in detail:

LOAN PARAMETERS DETAILS
Maximum loan amount
  • For premier institutes: 1.5 crores
  • For non-premier institutions: 60 lakhs
Interest rates

For premier institutes: Abroad and for Canada-9.7%

For non-premier institutions:  

Abroad: Up to 7.5 lakhs - 11.15%

               Above 7.5 lakhs - 10.20%

For Canada: Up to 7.5 lakhs - 11.15%

                      Above 7.5 lakhs - 11.70%

*Fixed interest rates are 1- 2% higher than floating interest rates.

* 0.2% concession for female students for non-premier institutes only.
Loan margin

There is no margin up to 4 lakhs rupees for both premier and non-premier institutions.

For premier institutes:

  • Above 4 lakhs to 7.5 lakh rupees: 15%
  • Above 7.5 lakhs: No margin.

For non-premier institutes:

  • Above 4 lakhs to 7.5 lakhs: 15%
    Above 7.5 lakhs: 10%
Moratorium period

Course duration + 1-year
Processing fee
  • Up to 7.5 lakhs with no processing fee
  • More than 7.5 lakhs, which is 1% of the loan amount (Approximately 10,000 rupees). This amount will be refunded if the student chooses a premier university. 
Legal and valuation charges 8,500 rupees (Non-refundable)

*Interest rate is floating according to changes in the repo rate.

Repayment Period

  • The moratorium period is course duration + 10 or 15 years.
  • For loans up to 7.5 Lakhs: Moratorium period + Maximum 120 installments
  • For loans above 7.5 Lakhs: Moratorium period + Maximum 180 installments

Collateral details:

  • Up to 7.5 Lakhs: No Collateral or third-party guarantee will be obtained, however, the co-obligation of parents is required.
  • Above 7.5 Lakhs to 80 Lakhs: Tangible collateral security equals 100% of the loan amount along with the assignment of future income.
  • Above 80 lakhs: Total security coverage should be 1.25 times the loan amount and assignment of future income.

PUNJAB NATIONAL BANK ABROAD EDUCATION LOAN SCHEME

Punjab National Bank is another public bank that offers abroad education loans under the scheme “PNB Udaan”. They give your dreams airplane wings to fly abroad and study and get the freedom you always wanted in life. The loan details of PNB Udaan are quite interesting. Take a look at the information down below.

Parameters  PNB Udaan Education Loan Scheme details
Loan amount range Need-based financing
Interest rate
  • For premier institutes + 100% collateral security: 9.25%
  • Any university + 100% collateral security: 10.50% for males/ 10% for females.
  • Loan up to 7.5 lakhs: 11.25% for males/10.75% for females.
  • Loan above 7.5 lakhs: 11.25% for males/ 10.25% for females.
Loan Margin
  • Up to 4 lakhs- NIL
  • Above 4 lakh - 15%
Collateral 
  • Up to 7.5 lakhs - no collateral security needed
  • Above 7.5 lakhs- acceptable collateral needs to be pledged to the bank.
Total Loan Tenure Up to 15 years
Total Expenses Covered All expenses related to the course abroad
Processing Fees 1% of tuition fee which is a minimum of rupees 10,000/- (Refundable after first disbursement)
Moratorium Period Course period + 1 year

*Interest rate is floating according to changes in the repo rate.

Understandably, all the above-mentioned details are TMI- too much information. Remember to go through all of it slowly and see if any one of them catches your attention to proceed further. And like always WeMakeScholars is here to help you. Talk to our expert financial officer for more clarity.

CANARA BANK ABROAD EDUCATION LOAN SCHEME

Canara Bank also has an abroad loan education scheme named “Canara Education Loan Scheme For Pursuing Masters Degree”. 

Let us look into its' details:

Loan Parameters Details
Loan amount
  • Minimum amount- 7.5 lakhs
  • Maximum amount- Depends on the collateral
Collateral coverage and loan amount
  • 100% and above- Minimum 7.5 lakhs/ Maximum- No cap
  • Less than 100%- 1 crore
Loan margin 10%
Processing charges

Depends on collateral value. If the collateral value is,

  • 100% and above- 0.5% of the loan amount, a maximum of 10,000 rupees.
  • Less than 100%- 0.5% of the loan amount, a maximum of 20,000 rupees.

Repayment tenure
  • Maximum of 15 years excluding the moratorium period (course period plus one year).
  • For skill development loans, 3 to 7 years depending upon the loan amount.
Expenses covered
  • 100% finance on Tuition fees
  • Travel expenses
  • Living expenses
  • Medical Insurance premium for students, if applicable.

*Interest rate is floating according to changes in the repo rate.

 

UNION BANK ABROAD LOAN EDUCATION SCHEME

Union Bank has a Special Union Education Loan Scheme for Abroad Studies called “Union Education Premier Abroad”. Union Bank is usually considered one of the best public banks to take an education loan from. Take a look and see if this is the product for you:

Loan parameters Details
Loan amount
  • Minimum: 7.50 Lakhs
  • Maximum: 1.5 crores
Loan margin
  • Up to 4 lakhs: No margin
  • Above 4 lakhs to Rs.40 lakh: 15%
  • Above 40 lakhs to 1.5 crores: 0% (Only if 100% collateral security is provided.)
 Interest rate 

Without collateral up to 40 lakhs- 9.8%

Up to 1.5 crores: With 50% collateral value- 9.5%

                             With 100% collateral value- 9.25%
Repayment tenure

15 years after the moratorium period
Moratorium period

Course period + 1 year

 

INDIAN OVERSEAS BANK ABROAD EDUCATION LOAN SCHEME:

Abroad education loans are the guiding light for our education journey. With the same intentions, Indian Overseas Bank introduced an abroad loan education scheme called "Vidyajyothi". Although it is not exclusively an abroad education loan scheme, the loan product contains foreign education loan details. This scheme also provides loans for students who get trained to become pilots. We shall take a look at it now:

Loan parameters Details
Loan amount

Minimum Loan Amount: Above Rs. 7.50 Lakhs

Maximum Loan Amount: 

  • Inland: Rs. 30 Lakhs
  • Foreign: Rs. 40 Lakhs
Rate of interest 11%
Loan margin
  • Studies in India: 5%
  • Studies Abroad: 15%
Moratorium period Course period + 1 year. 

CONCESSIONS ON INTEREST RATES FOR  INDIAN OVERSEAS BANK:

  • Girl Student-0.50%
  • For Interest Paid During Moratorium-1%

STUDY ABROAD

  • Institutes Ranked Up To 100-1.5%
  • Institutes Ranked 101 To 200-1%

And that's about all the loan schemes for abroad education loan schemes and their details. Higher education is a turning point that opens doors for career opportunities and employment. Thus it becomes very important to choose the right university and the right abroad education loan scheme.  I'm sure this article serves you like a catalog of products that guides you to choose the best product for you. For more guidance on picking the right education loan for you, contact our expert financial officers at WeMakeScholars. Call us now.