What Countries are Preferred by Government Banks for Abroad Education Loans?

✓ Benefits of Government Bank for Education Loan

✓ Countries Eligible for Abroad Education Loan

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It is that time of the year when lakhs of students start planning and preparing for their education abroad, from taking tests to applying for a visa. One of such preparation is arranging funds for your tuition fees and living expenses abroad.

An education loan from Government banks is considered to be one of the best sources of higher education funding. Most students first search for a government bank education loan before turning to any other financial institution. 

There are many reasons why a government bank loan is the most preferred type of education loan in India. This article aims to explain all of those reasons while also providing you with a list of countries that are considered eligible for a government bank loan.

Benefits offered by Government bank education loans

Government bank loans have many added advantages for students. One of the major advantages of availing an education loan through nationalized banks is the repayment policies set by the lenders. Some of the prime reasons and benefits of borrowing a government bank loan for higher studies are: 

  • Lower interest rates
  • Affordable processing fees
  • Payment-free moratorium period
  • Education loan interest subsidy
  • Income tax benefits, etc

There are more benefits of availing an education loan from government banks, which we've covered in-depth in one of our previous articles which we recommend you must read - What are the benefits of a Government bank education loan?

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Countries eligible for a Government bank education loan

The country wherein students pursue their studies is important to lenders, particularly private lenders. The public sector banks on the other hand do not bother much as they pretty much fund all courses in almost every major country with a reputation for education. They have not set any limit to the amount of abroad education loans that students can avail depending on the country of their higher studies.

However, having a thorough knowledge of the list of eligible countries for an abroad education loan from government banks could be an added plus in order to undergo your abroad education loan process without a lot of hassles.


The USA is one of the top choices of a lot of students for higher studies, it is also one of the top countries for which you can get a government loan for higher education. 
One of the highlights of borrowing a collateral-based education loan is the maximum amount that can be borrowed from government lenders. The value of your collateral is one of the factors that play a major role in the final education loan you get to borrow. In order to study in the USA, students can avail themselves of the maximum amount of INR 1.5 Cr. 

However, these numbers are an estimation and the actual amount depends on the value of the asset being pledged by you and your actual loan requirement.

A secured education loan covers the I-20 amount for USA applicants and the GIC amount for students who wish to study in Canada.

Also read: Why Masters in USA- Reasons to study in USA


All students who plan on borrowing an education loan in order to study in Australia need to keep one important point in mind while doing so. If you go through the previous articles listed here, you may observe that we have always stressed the benefits of borrowing education loans from government banks. Although students do have the option of approaching NBFCs for education loans, a government bank education loan can be the only saving grace for you when it comes to having a hassle-free visa process to study in Australia.
The Australian embassy majorly favors students who borrow secured education loans from Government banks like the SBI and other PSUs. This is because the Australian embassy needs assurance that students who wish to study in Australia will return to their home country after completing their courses. And Australian embassy thinks if students have collateral then they will return.

New Zealand

The New Zealand embassy follows the same rule as that of the Australian embassy, they too prefer only secured education loans as a source of funding. 
Government banks lend secured bank loans for education in New Zealand. The maximum loan amount limit set by government banks for those who need it to study in New Zealand solely depends on numerous factors. 

  1. Living expenses: The average living expenses required for students to study in New Zealand are estimated to be NZD 15000 for the entire course duration or a monthly sum of NZD 1250, for the duration of the course. The bank loans for education in New Zealand cater to these living expenses.
  2. Tuition fees: The tuition fees mentioned in your college admission are also catered for in the abroad education loan taken from government banks.
    Another very important point that you need to note is that although government banks do grant third-party collateral-based education loans to study in New Zealand, the embassy does not encourage this as a funding source. Hence, it is recommended that you avoid borrowing third-party education loans to study in New Zealand or in Australia.

The United Kingdom

A secured education loan to study in the UK is the best possible option to finance your higher studies. This is due to the following reasons.

  1. Secured loans are always cheap compared to unsecured education loans.
  2. The secured loan interest rates are way too low.
  3. Processing fees are relatively less.
  4. Lesser chances of your student visa application being rejected.

If you are still confused about the funding options for your higher studies abroad, you should get in touch with the WeMakeScholars team to get an unbiased opinion on which option suits your profile the best.

Let us take the reins and help you find the best education loan for you. It's time to take charge of your future

How WeMakeScholars resolve issues of Education Loan

One of the biggest issues of government student loans is that most bank officials, even those of the best banks for education loans, do not know much about education loans. As a result, their knowledge of the financial pre-requirements of studying in the above countries is very less or almost nil. 

In 2016, some of the major public banks like SBI, which is considered to be one of the best banks for education loans, released a circular stating that pre-visa disbursement can be released to students whose university/country requires them to deposit expenses related to the stay during their higher studies, prior to their visa process. 

Although this situation has improved a lot in today’s age, you might come across an official or two who do not know about this provision. Since the financial team of WeMakeScholars happened to play a crucial role in bringing this issue faced by students into the light, they share an excellent rapport with the core teams of all prominent government banks. Hence, if you are looking forward to getting your pre-visa disbursement in time, do approach the financial team of WeMakeScholars

Education Loan FAQs

  • Why do Indian students prefer studying abroad, and how can education loans help them achieve their goals?

    Indian students prefer studying abroad for several reasons, including exposure to a new culture, better job opportunities, and access to high-quality education. Education loans from Indian government banks can help these students achieve their goals by providing them with financial assistance to pursue their studies abroad.

  • which countries are the most popular destinations for Indian students studying abroad, and why?

    The most popular destinations for Indian students studying abroad include the United States, the United Kingdom, Canada, Australia, and New Zealand. These countries are preferred due to the availability of high-quality education, better job opportunities, and the presence of a large Indian diaspora.

  • What are the benefits of taking an education loan from Indian government banks, and how do they compare to other financial products?

    The benefits of taking an education loan from Indian government banks include lower interest rates, flexible repayment options, and longer repayment tenures. Compared to other financial products, education loans from Indian government banks are more affordable and have more favorable terms and conditions.

  • Are there any special schemes or offers for students applying for education loans from Indian government banks for studying abroad?

    Yes, there are several special schemes and offers available for students applying for education loans from Indian government banks for studying abroad. These include lower interest rates, longer repayment tenures, and flexible repayment options. To know about the details of schemes you can read our blogs related to government schemes for Education loans.

  • Are there any collateral requirements for education loans from Indian government banks, and what types of collateral are accepted?

    Collateral requirements for education loans from Indian government banks vary depending on the bank and the loan amount. Generally, loans above a certain amount require collateral, which can be in the form of immovable property, such as a house or land, or movable property, such as shares, or bonds.