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Explore the education loan for abroad studies scheme. Know about the top lenders, features, documents, eligibility and how to get an education loan easily with Propelld.

Know about Education Loan for Study Abroad, the Gateway to Global Education

Students looking for global exposure and the best learning opportunities are increasingly choosing to pursue their higher education abroad. However, funding such goals could be challenging, and it often calls for careful financial preparation. From tuition fees to traveling, the expenses can burden any family and student.

An education loan for abroad studies, in these situations, allows students and aspirants to cover the extensive expenses associated with studies. This student loan allows students to go to renowned institutions abroad and complete their dreams. It does so while taking all the worries of covering the cost of education.

Discover the interest rates, eligibility, documents, and how to get an education loan for study abroad.

What are the Types of Education Loans for Abroad Studies in India?

There are 2 types of education loans for abroad studies you can avail to pursue education in a foreign country. 

Secured Loan for Abroad Studies

If you have a security to pledge, you can apply and avail a secured education loan for study abroad. Here is what you need to know about a secured student loan:

  1. It requires the borrower to provide any collateral that the loan is issued against. These collaterals include real estate, a savings account, an insurance policy, etc.
  2. A secured student loan offers a reduced interest rate. 
  3. Government and Public banks in India often offer these student loans.
  4. If you have collateral to pledge, there is a good possibility of approval. 
  5. It offers an extended payback duration that eases the repayment for the students.
  6. The student loan offers a higher amount, which you can opt to increase.
  7. It offers a moratorium or grace period, which ensures no payback when you're studying.
  8. Approval is granted without regard to parental income.

Unsecured Loan for Abroad Studies

Here is what you must know about an unsecured student loan:

  1. To be eligible for this student loan, the borrower does not have to provide any collateral.
  2. This loan type is a riskier prospect for the bank, making it more difficult to get a loan from them without collateral.
  3. It has a greater interest rate compared to a secured loan, often by 1.5% to 4%.
  4. It offers a shorter time frame for repayment.
  5. You have to pay a portion of the loan during the study term.
  6. To get approved, parental income must be provided.

Features of Education Loan for Abroad Studies

Whether public banks or NBFCs,' every lender offers its own set of benefits and features. Before applying for an education loan from any of these lenders, you must consider all these features:

Loan Parameters Public Sector Bank Private Banks NBFCs International Lenders
Specialization Secured loans Unsecured and secured loans Unsecured loans Unsecured without co-applicant
Top Lenders State Bank of India, Bank of Baroda, and Union Bank of India Axis, ICICI, and IDFC HDFC Credila, Avanse, InCred, and Auxilo MPOWER and Prodigy
Interest Rate Starts from 9.8% Starts from 10.85% Starts from 11.25% Starts from 11.00%
Loan Amount Up to ₹1.5 cr Up to ₹50 lakh Up to ₹75 lakh Up to $100,000
Margin 10 - 15% 0 - 10% Nil Nil
Repayment Tenure Up to 15 years Up to 15 years Up to 20 years Up to 15 years
Repayment Options Free or Simple Interest Partial Simple Interest, Simple Interest, or EMI Simple Interest or EMI Simple Interest
Processing Time 10-15 days 5-7 days 5-7 days 5-7 days
Co-applicant Required No Yes Yes No
Tax Benefit Yes Yes Only HDFC Credila No

Eligibility Criteria for Education Loan for Study Abroad

While eligibility requirements could differ between banks and lenders, students must fulfill a few eligibility criteria in order to be considered for one. The eligibility criteria for education loans for study abroad are as follows:

  1. Indian Citizen: A student applying for a student loan to study abroad needs to be an Indian citizen.
  2. Admission: Students must have secured admission to the university or institution through entrance tests or merit.
  3. Admission Letter: The candidate ought to have obtained and received the admissions letter from an accredited university or institution.
  4. Recognized Institution: The university or the institution ought to be acknowledged by the UGC, AICTE, government, etc.
  5. UG/PG Program: The candidate has to have chosen a full-time UG/PG course of study.
  6. Co-applicant: A co-applicant (parent, guardian, spouse, parent-in-law, siblings, or first cousin) is required for the candidate who is willing to undertake full-time courses.
  7. Academic Performance: Applicants must have at least 50% marks in the last qualifying exam.

Interest Rates of Different Banks for Education Loan Abroad

Here are the interest rates offered by different lenders for education loans:

Banks Interest Rate
State Bank of India 8.30% to 11.50%
Punjab National Bank 8.55% to 11.25%
Bank of Baroda 9.10% to 12.45%
ICICI Bank 9.50% onwards
Bank of India 8.25% to 11.60%
Bank of Maharashtra 9.20% to 11.05%

Documents that are Necessary for Education Loan for Abroad Studies

Once you have ensured your eligibility, you will next have to gather all the documents. The list of documents that you will need to submit may differ from lender to lender. Here is a general list of documents that you will need to submit for education loan for study abroad:

Document Type Acceptable Document
KYC Documents
  • PAN card
  • Driving license
  • Aadhaar card
Address Proof
  • Aadhaar card
  • Voter's ID card
  • Passport
  • Utility bills (electricity/water/LPG)
  • Current house lease agreement
Academic Record Documents (Applicant)
  • 10th result
  • 12th result
  • Proof of admission
  • Undergraduate result semester-wise
  • Entrance exam results (GRE, GMAT, TOEFL, IELTS, etc.)
Financial Documents (Salaried Co-applicant)
  • Salary slips (last 3 months)
  • Form 16 (last 2-3 years)/IT Returns (last 2-3 financial years)
  • Bank account statement (6 months, salary account)
Financial Documents (Self-employed Co-applicant)
  • Business address proof
  • TDS certificate (Form 16A)
  • Last 3 years ITR
  • Certificate of qualification (for Doctor/C.A. and other professionals)
  • Bank account statement
Technical Documents for Collateral
  • NOC and allotment letter
  • Possession certificate
  • Approved layout plan and permissions
  • Copy of prior sale deeds
  • Conversion certificate (if applicable)
  • Urban clearance certificate
Legal Documents for Collateral
  • Sale/gift/partition deed
  • Khata certificate and extract
  • Encumbrance Certificate (EC)
  • Latest property tax receipt

Top Lenders for an Education Loan for Abroad Studies

Here is a thorough comparison of some of the top lenders providing study abroad loans based on the types of lender:

Types of Lenders that Provide Education Loan for Studying Abroad

When wanting to study in a foreign country, students can apply for education loans from different lenders. Here is a list of types of lenders that provide education loans in India:

  1. Government and Public Banks: There are numerous government and private bank loan schemes you can avail of to fund your education abroad.
  2. Private Banks: Conventional financial institutions that specialize in private banking provide education loans to students studying overseas.
  3. NBFCs: Non-banking Financial Companies are financial organizations that function without a banking license but provide a range of student loan schemes to those provided by regular banks.
  4. International Lenders: Financial organizations situated outside of India also provide international education loans for students studying abroad.

Top Public Banks Offering Study Abroad Loan

Education loan for abroad studies in SBI and UBI offer better benefits and features. This includes:

Loan Parameters State Bank of India Union Bank of India
Loan Amount (unsecured) Up to ₹7.5 Lakh Up to ₹40 Lakh
Interest Rate Starting at 11.15% Starting at 9.8%
Moratorium Period Course + 6 months Course + 12 months
Processing Fees ₹10,000 + GST No processing fee
Processing Time Up to 14 days Up to 7 days
Eligibility N/A Only for master program
Premiere Institute List N/A Interest rate fluctuation based on the institute

Top Private Banks Offering Study Abroad Loan

Here are the top private banks that offer study abroad loan:

Loan Parameter IDFC First Bank ICICI Bank Axis Bank
Loan Amount Secured loans - ₹1 cr
Unsecured loans - ₹75 Lakh
Secured loans - ₹1 cr
Unsecured loans - ₹40 Lakh
Up to ₹40 - ₹75 Lakh
Interest Rate 11.50 - 12.25% 9.85 - 15.5% 11 - 11.5%
Margin Money Nil 0 - 15% 0 - 5%
Processing Fees 1 - 1.25% 0.5 - 2% 0.75% of the loan amount + GST
Moratorium Period Course period + 12 months Course period + 6 months Course period + 1 year
Repayment Simple or Partial Interest Simple Interest Simple Interest
Loan Tenure 12 years 8-12 years 15 years
Co-applicant Minimum Income ₹35,000 / per month ₹60,000 / per month ₹35,000 / month
Pre-approved College Lists Platinum, Titanium, and Gold colleges and universities Divided into A1, A2, A3 & A4 categories Nil

Top NBFCs Offering Study Abroad Loan

Following are the top NBFCs in India that offer education loan for abroad studies

Loan Parameter HDFC Credila Avanse Auxilo InCred
Loan Amount ₹20 - 75 Lakh ₹20 - 75 Lakh ₹20 - 75 Lakh ₹20 - 80 Lakh
Interest Rate 11.25 - 13% 12.25 - 14% 12 - 13.25% 11.65 - 13.5%
Moratorium Period Course period + 1 year Course period + 1 year Course period + 1 year Course period + 1 year
Repayment during the Moratorium Simple Interest (SI) or partial Simple Interest (PSI) Simple Interest (SI) or partial Simple Interest (PSI) Simple Interest (SI) or partial Simple Interest (PSI) Simple Interest (SI) or partial Simple Interest (PSI)
Processing Fee 0.5 - 1.5% of the loan amount + GST 1 - 2% of the loan amount + GST 0.5 - 1.5% of the loan amount + GST 0.5 - 1% of the loan amount + GST
Loan Tenure 12 - 15 years 12 - 15 years 12 - 15 years 12 - 15 years
Margin Money Nil Nil Nil Nil
Minimum co-applicant income ₹30,000 - 60,000 ₹30,000 - 60,000 ₹20,000 - 40,000 ₹20,000 - 40,000

Get an Education Loan for Abroad Studies with Propelld

Many students find it complex and difficult to apply for education loan for abroad studies. The loan application process is always exposed to errors that can lead to unsuccessful outcomes. Propelld makes the whole process seamless and successful for you. Follow these steps to apply for student loan for abroad study:

  1. Check Your Eligibility: Propelld's education loan consultant will get in touch with you and assist you in learning everything there is to know about overseas student loans. You will receive a complete document checklist from the counselor as well.
  2. Login Into Propelld: Create an account and then log into your Propelld account.
  3. Upload Your Documents: Gather all the documents that are guided by the Propelld counselor and then upload them digitally into the secure platform.
  4. Await Approval: The counselor will handle the process from here and guide you through it at every step. After verification, the counselor negotiates for a better student loan amount and term.
  5. Loan Approval and Disbursement: Following document verification, you will get a letter of loan approval along with an agreement that you must sign. The approved student loan amount will be credited to your provided account.

Education Loan for Abroad Studies in 2024: A Comprehensive Guide

Raghuvamshi Kanukruthi
June 5, 2024
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Shivam Bhardwaj
March 15th 2022

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Know about Education Loan for Study Abroad, the Gateway to Global Education

Students looking for global exposure and the best learning opportunities are increasingly choosing to pursue their higher education abroad. However, funding such goals could be challenging, and it often calls for careful financial preparation. From tuition fees to traveling, the expenses can burden any family and student.

An education loan for abroad studies, in these situations, allows students and aspirants to cover the extensive expenses associated with studies. This student loan allows students to go to renowned institutions abroad and complete their dreams. It does so while taking all the worries of covering the cost of education.

Discover the interest rates, eligibility, documents, and how to get an education loan for study abroad.

What are the Types of Education Loans for Abroad Studies in India?

There are 2 types of education loans for abroad studies you can avail to pursue education in a foreign country. 

Secured Loan for Abroad Studies

If you have a security to pledge, you can apply and avail a secured education loan for study abroad. Here is what you need to know about a secured student loan:

  1. It requires the borrower to provide any collateral that the loan is issued against. These collaterals include real estate, a savings account, an insurance policy, etc.
  2. A secured student loan offers a reduced interest rate. 
  3. Government and Public banks in India often offer these student loans.
  4. If you have collateral to pledge, there is a good possibility of approval. 
  5. It offers an extended payback duration that eases the repayment for the students.
  6. The student loan offers a higher amount, which you can opt to increase.
  7. It offers a moratorium or grace period, which ensures no payback when you're studying.
  8. Approval is granted without regard to parental income.

Unsecured Loan for Abroad Studies

Here is what you must know about an unsecured student loan:

  1. To be eligible for this student loan, the borrower does not have to provide any collateral.
  2. This loan type is a riskier prospect for the bank, making it more difficult to get a loan from them without collateral.
  3. It has a greater interest rate compared to a secured loan, often by 1.5% to 4%.
  4. It offers a shorter time frame for repayment.
  5. You have to pay a portion of the loan during the study term.
  6. To get approved, parental income must be provided.

Features of Education Loan for Abroad Studies

Whether public banks or NBFCs,' every lender offers its own set of benefits and features. Before applying for an education loan from any of these lenders, you must consider all these features:

Loan Parameters Public Sector Bank Private Banks NBFCs International Lenders
Specialization Secured loans Unsecured and secured loans Unsecured loans Unsecured without co-applicant
Top Lenders State Bank of India, Bank of Baroda, and Union Bank of India Axis, ICICI, and IDFC HDFC Credila, Avanse, InCred, and Auxilo MPOWER and Prodigy
Interest Rate Starts from 9.8% Starts from 10.85% Starts from 11.25% Starts from 11.00%
Loan Amount Up to ₹1.5 cr Up to ₹50 lakh Up to ₹75 lakh Up to $100,000
Margin 10 - 15% 0 - 10% Nil Nil
Repayment Tenure Up to 15 years Up to 15 years Up to 20 years Up to 15 years
Repayment Options Free or Simple Interest Partial Simple Interest, Simple Interest, or EMI Simple Interest or EMI Simple Interest
Processing Time 10-15 days 5-7 days 5-7 days 5-7 days
Co-applicant Required No Yes Yes No
Tax Benefit Yes Yes Only HDFC Credila No

Eligibility Criteria for Education Loan for Study Abroad

While eligibility requirements could differ between banks and lenders, students must fulfill a few eligibility criteria in order to be considered for one. The eligibility criteria for education loans for study abroad are as follows:

  1. Indian Citizen: A student applying for a student loan to study abroad needs to be an Indian citizen.
  2. Admission: Students must have secured admission to the university or institution through entrance tests or merit.
  3. Admission Letter: The candidate ought to have obtained and received the admissions letter from an accredited university or institution.
  4. Recognized Institution: The university or the institution ought to be acknowledged by the UGC, AICTE, government, etc.
  5. UG/PG Program: The candidate has to have chosen a full-time UG/PG course of study.
  6. Co-applicant: A co-applicant (parent, guardian, spouse, parent-in-law, siblings, or first cousin) is required for the candidate who is willing to undertake full-time courses.
  7. Academic Performance: Applicants must have at least 50% marks in the last qualifying exam.

Interest Rates of Different Banks for Education Loan Abroad

Here are the interest rates offered by different lenders for education loans:

Banks Interest Rate
State Bank of India 8.30% to 11.50%
Punjab National Bank 8.55% to 11.25%
Bank of Baroda 9.10% to 12.45%
ICICI Bank 9.50% onwards
Bank of India 8.25% to 11.60%
Bank of Maharashtra 9.20% to 11.05%

Documents that are Necessary for Education Loan for Abroad Studies

Once you have ensured your eligibility, you will next have to gather all the documents. The list of documents that you will need to submit may differ from lender to lender. Here is a general list of documents that you will need to submit for education loan for study abroad:

Document Type Acceptable Document
KYC Documents
  • PAN card
  • Driving license
  • Aadhaar card
Address Proof
  • Aadhaar card
  • Voter's ID card
  • Passport
  • Utility bills (electricity/water/LPG)
  • Current house lease agreement
Academic Record Documents (Applicant)
  • 10th result
  • 12th result
  • Proof of admission
  • Undergraduate result semester-wise
  • Entrance exam results (GRE, GMAT, TOEFL, IELTS, etc.)
Financial Documents (Salaried Co-applicant)
  • Salary slips (last 3 months)
  • Form 16 (last 2-3 years)/IT Returns (last 2-3 financial years)
  • Bank account statement (6 months, salary account)
Financial Documents (Self-employed Co-applicant)
  • Business address proof
  • TDS certificate (Form 16A)
  • Last 3 years ITR
  • Certificate of qualification (for Doctor/C.A. and other professionals)
  • Bank account statement
Technical Documents for Collateral
  • NOC and allotment letter
  • Possession certificate
  • Approved layout plan and permissions
  • Copy of prior sale deeds
  • Conversion certificate (if applicable)
  • Urban clearance certificate
Legal Documents for Collateral
  • Sale/gift/partition deed
  • Khata certificate and extract
  • Encumbrance Certificate (EC)
  • Latest property tax receipt

Top Lenders for an Education Loan for Abroad Studies

Here is a thorough comparison of some of the top lenders providing study abroad loans based on the types of lender:

Types of Lenders that Provide Education Loan for Studying Abroad

When wanting to study in a foreign country, students can apply for education loans from different lenders. Here is a list of types of lenders that provide education loans in India:

  1. Government and Public Banks: There are numerous government and private bank loan schemes you can avail of to fund your education abroad.
  2. Private Banks: Conventional financial institutions that specialize in private banking provide education loans to students studying overseas.
  3. NBFCs: Non-banking Financial Companies are financial organizations that function without a banking license but provide a range of student loan schemes to those provided by regular banks.
  4. International Lenders: Financial organizations situated outside of India also provide international education loans for students studying abroad.

Top Public Banks Offering Study Abroad Loan

Education loan for abroad studies in SBI and UBI offer better benefits and features. This includes:

Loan Parameters State Bank of India Union Bank of India
Loan Amount (unsecured) Up to ₹7.5 Lakh Up to ₹40 Lakh
Interest Rate Starting at 11.15% Starting at 9.8%
Moratorium Period Course + 6 months Course + 12 months
Processing Fees ₹10,000 + GST No processing fee
Processing Time Up to 14 days Up to 7 days
Eligibility N/A Only for master program
Premiere Institute List N/A Interest rate fluctuation based on the institute

Top Private Banks Offering Study Abroad Loan

Here are the top private banks that offer study abroad loan:

Loan Parameter IDFC First Bank ICICI Bank Axis Bank
Loan Amount Secured loans - ₹1 cr
Unsecured loans - ₹75 Lakh
Secured loans - ₹1 cr
Unsecured loans - ₹40 Lakh
Up to ₹40 - ₹75 Lakh
Interest Rate 11.50 - 12.25% 9.85 - 15.5% 11 - 11.5%
Margin Money Nil 0 - 15% 0 - 5%
Processing Fees 1 - 1.25% 0.5 - 2% 0.75% of the loan amount + GST
Moratorium Period Course period + 12 months Course period + 6 months Course period + 1 year
Repayment Simple or Partial Interest Simple Interest Simple Interest
Loan Tenure 12 years 8-12 years 15 years
Co-applicant Minimum Income ₹35,000 / per month ₹60,000 / per month ₹35,000 / month
Pre-approved College Lists Platinum, Titanium, and Gold colleges and universities Divided into A1, A2, A3 & A4 categories Nil

Top NBFCs Offering Study Abroad Loan

Following are the top NBFCs in India that offer education loan for abroad studies

Loan Parameter HDFC Credila Avanse Auxilo InCred
Loan Amount ₹20 - 75 Lakh ₹20 - 75 Lakh ₹20 - 75 Lakh ₹20 - 80 Lakh
Interest Rate 11.25 - 13% 12.25 - 14% 12 - 13.25% 11.65 - 13.5%
Moratorium Period Course period + 1 year Course period + 1 year Course period + 1 year Course period + 1 year
Repayment during the Moratorium Simple Interest (SI) or partial Simple Interest (PSI) Simple Interest (SI) or partial Simple Interest (PSI) Simple Interest (SI) or partial Simple Interest (PSI) Simple Interest (SI) or partial Simple Interest (PSI)
Processing Fee 0.5 - 1.5% of the loan amount + GST 1 - 2% of the loan amount + GST 0.5 - 1.5% of the loan amount + GST 0.5 - 1% of the loan amount + GST
Loan Tenure 12 - 15 years 12 - 15 years 12 - 15 years 12 - 15 years
Margin Money Nil Nil Nil Nil
Minimum co-applicant income ₹30,000 - 60,000 ₹30,000 - 60,000 ₹20,000 - 40,000 ₹20,000 - 40,000

Get an Education Loan for Abroad Studies with Propelld

Many students find it complex and difficult to apply for education loan for abroad studies. The loan application process is always exposed to errors that can lead to unsuccessful outcomes. Propelld makes the whole process seamless and successful for you. Follow these steps to apply for student loan for abroad study:

  1. Check Your Eligibility: Propelld's education loan consultant will get in touch with you and assist you in learning everything there is to know about overseas student loans. You will receive a complete document checklist from the counselor as well.
  2. Login Into Propelld: Create an account and then log into your Propelld account.
  3. Upload Your Documents: Gather all the documents that are guided by the Propelld counselor and then upload them digitally into the secure platform.
  4. Await Approval: The counselor will handle the process from here and guide you through it at every step. After verification, the counselor negotiates for a better student loan amount and term.
  5. Loan Approval and Disbursement: Following document verification, you will get a letter of loan approval along with an agreement that you must sign. The approved student loan amount will be credited to your provided account.

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Frequently Asked Questions

Can I get 100% loan to study abroad?

Yes, you can get a 100% loan to study abroad. Private banks and NBFCs cover the full cost of studying abroad.

Who is eligible for abroad study loan?

Applicants applying for the education loan for study abroad must be Indian citizens and must have a letter of acceptance from a renowned overseas university.

Can I get a 25 lakhs education loan without collateral?

Yes, you can get ₹25 lakh in education loans without collateral. Axis, ICICI, and IDFC First Bank offer ₹25 lakh education loans without collateral.

Which bank gives a study loan easily?

IDFC FIRST Bank, Bank of Baroda, Union Bank of India, and State Bank of India are among the top banks that offer student loans easily.

Which bank is the best for education loans abroad?

State Bank of India and Union Bank of India are among the best banks for applying for education loans to study abroad.

Do I need to provide collateral security for an education loan for abroad studies in 2024?

Up to certain thresholds—typically around Rs. 20 lakhs—many lenders provide loans without security. Higher sums might call for permanent deposits or property as security.

Can I apply for an education loan if I plan to pursue an online or distance learning program abroad?

Loans are often offered by lenders only for full-time, on-campus study at accredited foreign colleges. Programs offered online or distant could not be accepted.

What is the typical interest rate range for education loans for international studies in 2024?

Depending on the size of the loan and the length of the repayment, interest rates for public sector banks may vary from 8 to 12% annually and for private banks from 10 to 15%.

How long is the repayment tenure for education loans for studying abroad in 2024?

With a moratorium of six months to a year after course completion, the usual payback term is between five and fifteen years.

Can I use the education loan to cover living expenses and other miscellaneous costs abroad?

Indeed, when studying overseas, you may utilize education loans to pay for living costs like travel, lodging, and tuition.

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