https://www.wemakescholars.com/education-loan/a-z-guide-to-student-loans-for-studying-abroad
A-Z Guide to Student Loans for Studying Abroad
✓ Eligibility Criteria Guide for Education Loan
✓ Document Checklist for Education Loan
Table of content
- A Guide to student loans eligibility to apply for an educational loan
- Documents required for student loans while applying for an education loan
- Top education loan providers in India for studying abroad
- Points to keep in mind while applying for an education loan in India for Study abroad
- Conclusion
- FAQ's
- Need Help? Ask Here!
Nowadays, with the increasing responsibilities and mounting expenses, funding education has become a crucial task for all parents as they find it difficult to self-finance their children’s education and support their dream of studying abroad. With the plethora of options available in the market to fund your education due to the huge demand to cover education loans for students who want to pursue higher education overseas, it is very important to understand the fundamentals of student loans for studying abroad.
As half knowledge on the subject is dangerous, you should do prior research on the market before making a decision and then choose the best option to fund your education for studying. This article will cover A-Z's guide to student loans and will give you the nitty-gritty of student loans for studying abroad.
A Guide to student loans eligibility to apply for an educational loan
With malleable terms and conditions, most Indian banks offer loans to meritorious students at a low interest rate who are unable to fund their education and help students to finance their study abroad.
Some of the education loan eligibility criteria to apply for an educational loan are as follows:
- The applicant applying for an education loan must be a resident of India.
- The applicant must have a letter of admission from a recognized university in India or abroad.
- The age of the applicant must be between 18-35 years while applying for a loan.
- The applicant must have a good/decent academic record to date.
- The applicant must have secured admission from a deemed university or accredited educational institution.
Documents required for student loans while applying for an education loan
Documents Name |
Lists of Documents |
Mandatory Documents |
|
Academic document |
|
Proof of identity |
|
Proof of residence |
|
Employment or business proof of co-applicant or guarantor |
|
Other documents |
|
Additional documents (if applicable) |
|
Legal documentation (in case of collateral) |
|
Other important documents (in case of collateral) |
|
Legal documents required for Gift or Will properties |
(Any Legal Heir Certificate/ Succession Certificate/ Registered Family Tree is required) |
Note: As per the bank-laid norms, documents may differ from bank to bank as per the requirements of the applicant and the co-applicant. You can get in touch with our financial experts at WeMakeScholars who will assist you with all the required details for an educational loan.
Top education loan providers in India for studying abroad
There are various alternatives available in the market where multiple education loan providers are willing to lend loans to students for study abroad.
1. State Bank of India
SBI Education Loan |
Values |
Interest Rate |
|
Min Loan Amount |
20 Lakhs |
Maximum Loan Amount |
1.5 Cr |
Tenure of Repayment |
Up to 15 years |
Processing Fee |
|
2. Bank of Baroda
BOB Education Loan |
Values |
Interest Rate |
|
3. Bank of India
BOI Education Loan |
Values |
Interest Rate |
|
Tenure of Repayment |
Up to 15 Years |
Processing Fee |
No processing charge for study in India |
4. Bank of Maharashtra
BOM Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
|
Tenure of Repayment |
Maximum 7 years after the commencement of Repayment |
5. Canara Bank
Canara Bank Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
|
Tenure of Repayment |
Maximum 15 years after the commencement of Repayment |
6. Central Bank of India
CBI Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
|
Tenure of Repayment |
Maximum 15 years after the commencement of Repayment |
7. Indian Overseas Bank
Overseas Bank Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
|
Tenure of Repayment |
Maximum 7 years after the commencement of Repayment |
8. Punjab National Bank of India
PNB Education Loan |
Values |
Interest Rate |
Above 7.5 lakhs-
|
Maximum Loan Amount |
|
Tenure of Repayment |
Maximum 15 years after the commencement of Repayment |
9. Union Bank of India
Union Bank Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
|
Tenure of Repayment |
Maximum 15 years after the commencement of Repayment |
10. UCO Bank
UCO Bank Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
|
Tenure of Repayment |
Maximum 15 years after the commencement of Repayment |
11. ICICI Bank
ICICI Bank Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
|
Tenure of Repayment |
|
12. Axis Bank
Axis Bank Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
Upto 75 Lacs |
Tenure of Repayment |
Maximum 7 years after the commencement of Repayment |
13. HDFC Bank
HDFC Education Loan |
Values |
Interest Rate |
|
Maximum Loan Amount |
|
Tenure of Repayment |
Maximum 7 years after the commencement of Repayment |
Note: All Government Banks offer 0.50% concession in the interest of girls.
Points to keep in mind while applying for an education loan in India for Study abroad
1. Check your eligibility before applying for a loan- Before applying for an education loan in India for studying abroad, check your education loan eligibility criteria in advance and then proceed ahead.
2. Calculate the loan amount- Determine the loan amount you need to finance your education like college fees, examination, laboratory, travel expenses, cost of books, laptop, library fees, and other equipment.
In a few cases, students forget to calculate their moratorium period while calculating EMI payments which will eventually affect the monthly payments they have to pay to their lenders. To avoid doing this, use an EMI loan calculator to calculate your monthly EMI accurately.
3. Apply for an education loan to avoid hassle at the last moment- After confirmation of admission to the college, most colleges do not accede adequate time for fee payment. The applicant has to process sufficient funds at the last minute. To avoid hassle at the last minute, one should apply for an education loan in advance. Our team at WeMakeScholars will help you in the entire loan process and get your loan sanctioned in 15-20 days.
4. Compare other loan lenders before taking an education loan- Different banks offer different interest rates with satisfactory repayment policies. Well-versed research of the market will enable you to explore various options and help you select the top lender to fund your education abroad.
5. Prepare all the required documents- Check all the documents you will need to avail of an education loan. To avoid last-minute hassle arrange all the documents like collateral-related documents, legal documents, academic-related documents, etc.
6. Plan your EMIs and repayment tenure- Education loan repayment in India for study abroad starts after the moratorium period (repayment holiday). So, keeping future perspectives in mind, plan your repayment tenure and EMIs accordingly.
Conclusion
This guide to student loans will help you navigate through all the required details. It is advised that students do their market research before applying for an education loan and strictly meet the eligibility criteria as banks do not lend loans in case of a lack of documents. At WeMakeScholars our team understands the requirements of the banks and also values students’ time and efforts, because of this we help students with abroad education loans with 14+ banks. We will help you get the best education loan lender according to your profile.
FAQs:
-
Who is eligible for an education loan?
-
What are the documents required for a student loan?
-
How to apply for a student loan in India?
-
Which banks provide education loans in India?
-
What is the maximum amount I can borrow for a student loan to study abroad ?
-
Can I transfer my student loan for studying abroad to another lender?
-
Are there any tax benefits for repaying a student loan for studying abroad?
-
Can I get a student loan for studying abroad for a short-term course or program?
-
Can I get a student loan for studying abroad without providing proof of admission?
NEWS
The Ministry of Finance has provided clarification on tax collected at source (TCS) for foreign remittances related to education expenses. Under the Liberalized Remittance Scheme (LRS), parents can send up to Rs 7 lakh per year for education-related expenses without being subject to TCS.
Remittances exceeding Rs 7 lakh, financed by an Education loan, will incur a TCS of 0.05%, while remittances above Rs 7 lakh without a loan will attract a TCS of 5%. Ancillary expenses for studying abroad, such as commuting tickets, tuition fees, and day-to-day expenses, will also be treated as education-related expenses and attract a lower TCS rate. To remit money under LRS, parents need to submit a declaration specifying the purpose of remittance and provide student and university details. When remitting from a loan, additional documents are required.
It is crucial to accurately track LRS codes and mention the correct code during the remittance process. The existing rates of TCS for sending money through LRS for education purposes will be in effect until September 30, 2023.
However, other related expenses may have different considerations. Remitters must maintain accurate records of total remittances under LRS, and false information may lead to appropriate action. The ministry advises banks to obtain an additional declaration to confirm remittance limits. By adhering to these guidelines, parents can ensure compliance and support their child's education abroad
Last updated on - 10/07/2023
In recent years, the demand for education loans in India has experienced a sharp upswing, primarily due to a growing number of Indian students pursuing overseas education opportunities. This trend can be attributed to the rising cost of living and increased aspirations for higher education, especially among students from Tier 2 and 3 cities.
Historically, the education loan sector had faced challenges due to high NPAs. However, recent data from the RBI indicates a revival in this sector. Outstanding bank loans to the education sector in FY23 reached Rs 96,847 crore, reflecting a robust 17.1% YoY growth. By July 2023, outstanding education loans had surged to over Rs 1.03 lakh crore, marking nearly a 20% increase compared to the previous year.
Factors contributing to this growth include a rise in demand for both domestic and overseas offline courses post-COVID-19. According to government data, the number of students availing education loans for overseas education has increased by 215% over the past decade, with a threefold increase in borrowers during this period.
Despite concerns about rising NPAs in education loans, bankers remain optimistic, as the sector's share in overall personal loans remains low at around 2%. However, experts like Rathin Roy have expressed apprehensions about the increasing trend of education loans, highlighting that even affluent families are resorting to borrowing to finance their children's education, which raises concerns about the financial burden on students and their families.
Last Updated- 25/09/2023

WeMakeScholars- supported by IT Ministry, Govt. of India.
Our Education Loan team will help you with any questions
Kindly login to comment and ask your questions about A-Z Guide to Student Loans for Studying Abroad