Education loan eligibility in India 2019-20 [Complete Guide]
Education loans are considered to be one of the best options when it comes to funding your higher education. Every year, a huge number of students apply for higher education in universities/colleges abroad. A major percentage of these students require an education loan to fund their higher studies abroad. However, not all of them are deemed eligible by their lending bank for an education loan. In many cases, the co-applicant is not deemed eligible. This is because many such students are unaware of the education loan eligibility criteria in India which are set by different major lending banks for loan applicants and especially for co-applicants. Since the procedure to obtain an education loan for higher studies in India is not much complicated, we will be focusing only on the abroad education loan schemes offered by these banks.
This article will highlight the different education loan eligibility criteria in India, set by some of the major lending banks, for both loan applicants and co-applicants. So here we go!
The State Bank of India
SBI is the first name that comes to the minds of students and guardians alike when they decide to take an education loan to fund their higher studies abroad. SBI offers abroad education loans under the Global Ed-Vantage scheme. This scheme offers only collateral based education loans to the needful students. Here’s a very brief glimpse of what this scheme offers:
Factors to be considered
|Interest Rate:||9.7% (Female candidates), 10.2% (Male candidates)|
|Loan amount range:||INR 10 Lakhs to INR 1.5 Cr.|
|Total Loan Tenure:||Up to 15 years|
|Total Expenses covered by the education loan:||Tuition Fees, Living expenses, Study aid expenses, travel expenses, library fees, etc.|
|Repayment method:||Average moratorium period comprises of the duration of the course + 6 months (can be extended to a year)|
|Processing Fees:||Rs. 10,000|
The SBI education loan eligibility in 2019
Coming to the major point of discussion, nationalized banks like SBI have not set any stringent rules for education loan candidates per se. Co-applicants having all sorts of professional and financial profiles are accepted for education loans under the Global Ed-Vantage scheme.
Although there are no set education loan eligibility criteria in SBI for co-applicants and students, it is advised that students should possess all the necessary documents related to their co-applicant’s finances, to have a relatively easier education loan process. The following points should be kept in mind when students apply for an education loan.
- The co-applicant’s income proof: If co-applicants have a salaried job, they need to provide their ITR documents filed for a period of two years. If they are self-employed, their bank statements are also considered by banks as financial proof. If you apply via the online team, you can have a co-applicant who doesn’t have an income too.
- The co-applicant should preferably be a resident of India.In the event where a student is a resident of India and their co-applicant is not, the time taken by the bank to sanction such students loans is slightly higher. Again it is better to apply online so that the online team will guide you better and you can expect faster processing.
Students don’t have to worry about these SBI education loan eligibility criteria when they apply through WeMakeScholars. This is possible because the finance team has been at the core of many major policy decisions which were taken by SBI regarding abroad education loans. If you are stuck at any point in your abroad education loan procedure, you may request a callback from our finance officers and they will respond to your request at the earliest.
The Bank of Baroda
The Bank of Baroda is another major lender of education loans in India and is emerging as a competitive lender in the education loan market. The Bank of Baroda offers abroad education loans under the Baroda Scholar Scheme. The Bank of Baroda has categorized universities into two different lists, called the prime list and the non-prime list, on the basis of their worldwide ranking and the courses offered by them.
Now, the most important point to be noted is that the interest rates and loan amounts offered to students seeking abroad education loans from the Bank of Baroda vary, depending on which of the above lists, the chosen course and the college belong to. If you apply via the online process, it will be processed within 14 days. Here’s an overview of the same:
|Prime University List||
Non- Prime University list
|Interest Rate||9.45% (Female Students)9.95% (Male Students)||10.2% (Female students)10.7% (Male students)|
|Loan Amount||Rs.8 Lakhs to Rs.80 Lakhs||Rs.8 Lakhs to Rs.60 Lakhs|
Other important factors like the moratorium period, processing fees, loan tenure, repayment period, etc. are similar for institutes belonging to both the lists. Apply online for Bank of Baroda education loan online for faster processing.
Bank of Baroda education loan eligibility in 2019:
As mentioned in the previous paragraphs, like all public banks in India, the Bank of Baroda has not set any education loan eligibility criteria for students and co-applicants. Co-applicants having all kinds of financial profile can apply for an abroad education loan with the Bank of Baroda. Despite this, a co-applicant fitting the following education loan eligibility criteria have higher chances of obtaining their education loans faster and without any hurdles:
- Multi-city case: If the co-applicant resides in the same city as the student, it generally becomes easier for banks to process the student’s documents. This step generally takes little more time if the co-applicant resides in another city/country.
- CIBIL Score: The only Bank of Baroda education loan eligibility criteria set for co-applicants is on the basis of the CIBIL score. Co-applicants having a CIBIL score less than 650 are generally not entertained for abroad education loans.
- Proof of finances: If the co-applicant is a salaried employee, it is recommended that they have their ITR filing documents of at least two years before they approach the bank for an abroad education loan. If they are self-employed, then bank statements can serve this purpose.
- The student should be an Indian citizen. NRIs are also welcome to apply.
- The student should have preferably secured an admission to the preferred university before they apply for an abroad education loan
In most cases, it so happens that when students who don’t meet the above criteria approach banks directly, most bank officials hesitate to issue the required education loans. However, if they apply through WeMakeScholars, their education loan applications can be processed much faster with our financial team’s help. This is because our team has been part of the core of many major policy decisions taken by top Indian banks like the SBI and the Bank of Baroda. Also, since our initiative is being funded by the Govt. of India, the services rendered by us are absolutely free and there are no hidden charges. Loan processing through us is a very transparent affair. You may request a callback from our financial team in order to apply for abroad education loans through us.
ICICI bank education loan is an emerging name in the education loan sector. Certain terms and conditions of the ICICI bank education loan resemble those set by some of the major government banks functioning in India. Let’s take a look at the education loan terms of ICICI bank.
The ICICI bank has bifurcated international educational institutions on the basis of their worldwide rankings and the validity of the courses offered by them. These lists are named A1, A2 and A3. To know the entire list, speak with our financial officer. The interest rates and the maximum possible loan amount and the kind of education loans offered by the ICICI bank differs based on which list the university/college to which the student is going, belongs. Also, ICICI offers education loans for bachelors courses abroad.
|A1 Institutes||A2 Institutes||
|Interest Rate||PG courses only – 11.75%||UG – 12.75% PG – 12.5%||UG – 12.5%PG – 13.99%|
|Max Loan Amount||Unsecured – Rs. 40 Lakhs||Unsecured – Rs. 20 Lakhs||Only Secured loans are possible. The loan amount depends on the value of collateral pledged.|
- Processing Charges: 1% of the total loan amount
- Moratorium period : Course duration + 6 months
- Processing time: 10 days* (if you apply online)
- Maximum loan tenure: 10 days
- Loan Margin: 15% for education loans above Rs.20 Lakhs.
* The processing time for any kind of education loan with ICICI bank may differ on the basis of the student’s and their co-applicants’ profiles. If you apply through WeMakeScholars, this will not happen as our team is authorized to negotiate the processing time with ICICI bank officials. So if you are stuck at this stage of your education loan, don’t hesitate to place a callback request from our team. Else, better to start your loan processing via WeMakeScholars as you can avoid such issues.
Unlike government banks, ICICI bank has set some very stringent eligibility criteria for students and co-applicants alike. Let’s take a look at some of the education loan eligibility criteria in ICICI bank for students and co-applicants.
ICICI Bank education loan eligibility in 2019:
ICICI bank education loan eligibility criteria for students:
Any student who plans on applying to ICICI bank for an abroad education loan must fulfill the following criteria:
- Should be an Indian National
- Should have completed his 10+2 or graduation- depending on the course he has applied for
- Should have received admission into ICICI Bank’s List of Select Universities (get to know the list by speaking to WeMakeScholars team)
ICICI bank education loan eligibility criteria for Co-applicants:
A person will only be accepted as a co-applicant if they fulfill the following criteria set by the ICICI bank:
- Accepted co-applicants are parents, siblings (brothers/sisters), in-laws.
- ITR is mandatory for co-applicants.
Education loan eligibility criteria in ICICI bank (exceptions):
If a student has secured admission into any of the institutions/colleges mentioned in the A1 or A2 lists for a masters course and has a work experience of 3+ years, no financial documents are required from their co-applicants. However, this facility is not applicable to students who have secured admission in A3 institutions. Speak to the financial officer from WeMakeScholars so that you can get to know the list.
Education loan eligibility criteria by NBFCs
NBFCs (Non-Banking Financial Companies) are the most preferred choice of many students who need to borrow non-collateral education loans to fund their higher studies abroad. However, since these are non-banking companies, and mainly provide education loans without taking any security from the student, the eligibility criteria set by them are slightly more rigid in comparison to public banks. Before going to details, make sure you apply to NBFCs via WeMakeScholars instead of going to them directly as you will be eligible to get an assured discount of 0.5-1% in your rate of interest.
InCred Education loan Terms:
InCred is one of the prominent NBFCs functioning in India. The eligibility criteria set by their team varies on a case-by-case basis. Let’s take a look at some of their education loan terms before moving on to their eligibility criteria. However, below are the terms you get when applied via WeMakeScholars.
|Rate of Interest||11.5% – 13.5% Depending on the student’s profile|
|The maximum possible amount for an education loan||Rs.50 Lakhs|
|Preferred countries||USA, Germany, Canada, Ireland (others case to case)|
|Preferred Courses||Masters and Diploma courses in STEM & Management Fields|
|Repayment Options||Flexible repayment options available|
|Processing Charges||0.9% – 1% of the total loan amount.|
|Loan Tenure||Maximum 10 years|
When a student applies for an education loan without collateral with InCred, the terms and conditions applicable to their loans vary depending on the student’s profile. Let’s take a look at some of the education loan eligibility criteria set by InCred for students and co-applicants.
InCred education loan eligibility in 2019
InCred education loan eligibility criteria for students:
- The student should be at least 18 years of age. and not more than 30 years ideally.
- The student should be a citizen of India
- The student should have applied/ received an admit into a recognized university/college in any of the preferred countries abroad.
- The student should have passed all the required qualification exams (GRE, TOEFL/IELTS, GMAT, etc.)
InCred education loan eligibility criteria for Co-applicants:
- Co-applicant should be a close blood relative of the student. (Parents or siblings are preferred)
- The co-applicant should be employed/owning a business with a steady source of income.
- The co-applicants’ ITR documents of at least 2 years is a mandatory requirement to be able to borrow unsecured education loan from InCred.
- The co-applicant must have a good CIBIL score.
If you may have gone through the education loan terms of InCred, in the above table, you may have noticed that their interest rates are quite high in comparison to those offered by public banks. In order to get unsecured education loans from InCred at comparatively lower interest rates, it is recommended that you apply through the financial team at WeMakeScholars. This is because our team can negotiate the interest rates on the student’s behalf and ensure that the student gets the better end of the education loan scheme. So if you are worried about the processing fees and the relatively high interest rates, do register for a callback request from our team and we will respond to your request at the earliest.
Auxilo is another emerging NBFC that has been known to issue education loans. Before we explore the Auxilo education loan eligibility criteria, let’s take a look at some of their education loan terms. Though their terms and conditions vary from student to student, you can get the below terms when applied via WeMakeScholars.
|Interest Rate||11.5% – 14% Depending on the student’s profile*|
|Preferred Countries||USA, Germany, Canada, Ireland (others case to case)|
|Preferred Courses||Masters and Diploma courses in the STEM field|
|Loan Tenure||10 Years|
|Loan Margin||0 %|
|Maximum Loan Amount||Rs. 50 Lakhs|
|Processing Charges||1% – 1.5% of the Loan Amount|
|Processing Time||7 – 10 Days**|
*The interest rates for a student having a good profile can be negotiated by the WeMakeScholars team if the student applies through us.
** The processing time taken by any financial institution can vary depending on the student’s profile and the co-applicant’s financial profile. The Auxilo education loan processing time is generally restricted to 7-10 days when they apply through the WeMakeScholars team.
Now that you have had a glimpse of the Auxilo education loan terms, let’s move on to the next important factor which is the Auxilo education loan eligibility criteria.
Auxilo education loan eligibility in 2019:
Auxilo education loan eligibility criteria for students/loan applicants:
- The student should be an Indian Citizen.
- The student should be above 18 years of age and not more than 30 years ideally.
- The student must have secured admission into any of the courses from any of the universities located in the countries stated above.
The Auxilo unsecured education loan eligibility criteria for co-applicants:
- The co-applicant should be a blood relative. Parents and siblings are generally preferred.
- The co-applicant should be employed with a steady income. In case if the co-applicant is a salaried employee, then financial documents like 2-3 years’ ITR filing documents would be required of them. ITR is mandatory for co-applicants.
- If the co-applicant is self-employed, they should provide the related bank statements to Auxilo at the time of applying for an unsecured education loan.
Certain exceptions accepted by NBFCs for unsecured abroad education loans when applied via WeMakeScholars:
- Multi City cases: The WeMakeScholars team has often come across cases where the loan applicant (student) and the co-applicant were not present in the same city, district, state. Normally the process becomes a bit more lengthy for students whose co-applicants are not residents of the same city where they have applied for an education loan. Such cases are called multi-city cases. In such a scenario, the financial team at WeMakeScholars has managed to help students get their education loans on time. So if you are stuck in your education loan process because of this factor, feel free to request a callback with the WeMakeScholars team and the assigned financial officer will definitely provide you with the required assistance.
- Pre-Visa disbursement: This is another stage where applicants often get stuck. Although it happens rarely, certain universities/colleges abroad sometimes demand that the tuition fees be transferred before a student’s visa process. Since this amount is catered for in their education loans, many students often get stuck because banks hesitate to process this amount without receiving any guarantee from the student’s part. Especially when you apply for unsecured education loans through WeMakeScholars, this becomes much easier. Our team can totally help you get the required disbursement amount in order to fulfill the university/college criteria. So don’t forget to get in touch with us if you are in this dilemma.
- Additional co-applicants: In cases when co-applicants do not meet the normal education loan eligibility criteria set by the NBFCs due to some genuine reasons, additional co-applicants can be added. The preferred choices apart from blood relatives are uncle, aunt and in some cases, in-laws can also be named as co-applicants.
So that is pretty much it! As mentioned at the beginning of this article, thousands of students apply for education loans every year. Education loan eligibility criteria in India is something that every loan applicant should be aware of. This always helps in the long run. We hope that through this article, we were able to give you sufficient information on the same. For more assistance on your case, speak with the WeMakeScholars team. A dedicated financial officer will be assigned to you to guide as per your profile.
Note: WeMakeScholars is an organization funded and supported by the Government of India that focuses on International Education finance. We are associated with 10+ public/Pvt banks/ NBFCs in India and help you get the best abroad education loan matching your profile. As this initiative is under the Digital India campaign, it’s free of cost. The organization has vast experience dealing with students going to various abroad education destinations like the US, Canada, UK, Australia, Germany, Sweden, Italy, China, France among others