Education loans have become important financial tools that make higher education affordable for students. However, without the right guidance, students often face challenges in their education loan application and repayment. Financial counselling for education loans helps students and their families make informed decisions and avoid financial stress.

In this article, we will explore what financial counselling is and why it matters for education loans.  We will also discuss the various challenges of implementing education loan counselling in India, along with how WeMakeScholars helps education loan counselling.

What Is Financial Counselling?

Financial counselling for education loans refers to the process where financial experts guide students and their families through their student loan process. Financial counsellors assess each student’s profile and provide them with personalised guidance.

Many students and their families are unaware of important financial factors that their student loans. Financial experts guide students and their families to help them understand key factors related to education loans.

Education loan counselling helps students compare student loans from different lenders to find the most suitable education loan for their studies. These education loan counsellors help students create an effective budget and repayment plan to manage student loans efficiently.

Current Scenario: Education Loans Without Counselling

In the current scenario, where many students and their families have limited financial awareness, obtaining education loans without proper financial guidance can significantly impact their student loans. The following are several disadvantages of applying for an education loan without the right financial counselling:

  1. Long Processing Times: Not having the right guidance leads to delays in the documentation and verification process of your education loan.
  2. Limited Loan Options: Education loan counsellors compare the student loan products of different lenders to provide the most suitable option for each student. Without financial counselling, many students will remain unaware of education loan products from different lenders and have limited loan options. This hinders their ability to get the most suitable education loan for themselves.
  3. High Interest Rates: Education finance counsellors can negotiate the loan terms with the lenders and offer the best interest rate on education loans to students. Taking an education loan without the guidance of a financial expert can result in a high interest rate on your education loan, which increases the financial burden of the loan.
  4. Not Choosing the Right Repayment Plan: Financial counsellors provide students with a suitable repayment plan that helps them manage their finances during the repayment period. Without the right guidance, many students end up choosing an inconvenient repayment plan that doesn’t align with their financial capacity. As a result, they struggle to make repayments on their student loan.
  5. Post Sanction Issues: Students taking an education loan without financial counselling often face various issues after their loan is sanctioned, such as delay in the disbursement, pre-visa disbursement issues, and repayment issues. This can lead to penalties due to delays and various visa issues for the students. This happens mostly because not every official at every bank branch is aware of the education loan disbursement and pre-visa disbursement requirements and policies. However, when applying for the education loan with the guidance of a trusted education loan counsellor, they can help you solve such issues on time.

Get in touch with WeMakeScholars to avoid such post-sanction issues on your education loan. When you apply for an education loan through us, we have a dedicated post-sanction team that can negotiate with the bank on your behalf to timely resolve any issues you face after the loan is sanctioned.

Why Financial Counselling for Education Loans Matters?

  1. Helps Borrowers Understand Loan Terms: While education loans help students finance their education, many students and their families are unaware of important factors, making the student loan a significant financial burden. Financial counselling educates students and their families about important loan terms, such as the difference between simple interest and compound interest, moratorium period, and repayment tenure in education loans.
  2. Improves Loan Planning & Decision-Making: Many lenders offer various education loan products with varying terms. Students often struggle to compare these lenders as they are often unaware of the loan terms and eligibility criteria of these lenders. Education loan counselling helps you compare the loan terms of different lenders. An expert financial counsellor evaluates your eligibility criteria for an education loan from various lenders and provides you with the most suitable option. Financial counselling also assists in planning your education loan and helps you make the right decisions.
  3. Reduces Risk of Future Defaults: Education loan counsellors also provide repayment guidance. They guide you in choosing the right repayment plan so that you can effectively manage your finances during the repayment period. By choosing the repayment plan and guiding you throughout your education loan, financial counselling reduces your risk of defaulting on the education loan. 
  4. Promotes Responsible Borrowing: Financial counselling makes repayment of student loans easier by helping individuals understand their financial capacity and make an effective repayment plan. This is how financial counselling promotes responsible borrowing in society.

Challenges in Implementing Mandatory Counselling in India

While mandating education loan counselling in India significantly helps students fund their higher studies, the following challenges of student loan counselling in India make it very hard:

  1. Lack of awareness: Lack of awareness about the importance of financial counselling is one of the major challenges for mandating education loan counselling in India. A majority of students and their parents lack awareness about education loan counselling in India, making it difficult to implement it.
  2. Resistance from lenders: Implementing mandatory counselling for education loans in India can create additional costs for lenders, which can lead to resistance to implementing it. 
  3. Time constraints during loan processing: Banks always want to offer a swift process for education loans to cater. Implementing mandatory counselling for education loans in India increases the average timeframe of the education loan process in India, which further opposes its implementation.
  4. Finding a trusted Financial Counsellor: Apart from time constraints and resistance from the lenders, another major challenge of implementing mandatory counselling for education loans in India is finding a trusted financial counsellor.

How WeMakeScholars Can Help with Education Loan Counselling

WeMakeScholars is an organisation dedicated to providing complete education loan support to students. Being a government-supported organisation, it is one of the most trusted education loan support organisations among students and families in India.

Our experienced team of financial officers carefully analyses the profile of each student and provides personalised guidance to students and families. The following is how approaching WeMakeScholars for education loan counselling can boost your student loan journey.

  1. Expert Guidance: When you approach us, a dedicated financial officer analyses your profile and connects you with the best lenders, as per your needs and eligibility. They guide you at every step of your education loan process so that you can have a smooth and stress-free education journey.
  2. Quick Processing Time: We offer a swift education loan process sanctioning within 6-7 days through a private bank or NBFC, and around 15-20 days to get your education loan sanctioned from a public bank. The above-mentioned processing time is applicable after all the required documents are submitted.
  3. Lower Interest Rates: Your financial officer will negotiate with your lender on your behalf to get you the best education loan with low interest rates.
  4. Simple Application Process: You can simply apply for education loans by filling out our application form online or request a callback now, and one of our dedicated financial officers will get back to you at the earliest.
  5. Complete Support: Our support and guidance don’t just end at the sanction of your loan; we provide our support and assistance till the repayment of the last EMI of your student loan.
  6. Free-of-cost: Since we are funded and supported by the IT Ministry under the Digital India Campaign, all our services are free of cost for students.

Conclusion

Education loan counselling plays a major role in helping students achieve their academic and career goals. Expert financial counsellors help students and families understand the key factors affecting the education loan process. They assist students in budgeting and planning their education loan repayment. 

However, a lack of awareness and difficulty in finding a trusted financial counsellor make it challenging to implement education loan counselling in India. WeMakeScholars, being a government-supported initiative, is one of the most trusted organisations offering education loan support. Our team provides expert education loan counselling to help students achieve their academic and career dreams.