For good education abroad, Education Loan for Abroad Studies by Indian Government, Student loans, Students credit card loans, study loans are available from banks.
Best Education Loan in India 2023: The Government of India is providing the facility of education loans, also known as study loans, for all students who wish to obtain higher education abroad. This enables all students to pursue their higher education properly.
There are many students in our country who dream of obtaining good education by going abroad. However, students or parents whose children want to study abroad but are unable to do so due to weak financial status.
All students do not need to worry now because there are many banks in India that are providing loans for studying abroad. You can easily get an Abroad Loan for Education for yourself or your children.
If you also want to take an Education Loan from a bank for higher education abroad, we are providing you with the details in this article today.
Education Loan for Abroad Eligibility
To be eligible for an Education Loan for Abroad, the following criteria must generally be met:
- The applicant must be a citizen of India.
- The applicant must have secured admission in a recognized university/institution for a specific course.
- The applicant must have a good academic record.
- The applicant must have a co-applicant/guarantor, who is usually a parent, spouse, or sibling with a stable income and good credit history.
- The applicant must be between the age of 16 to 35 years (may vary from bank to bank).
- The applicant must provide collateral or security for the loan (may vary from bank to bank).
- The loan amount generally covers tuition fees, living expenses, and other related expenses.
However, the specific eligibility criteria may vary from bank to bank and may also depend on the loan amount and the course of study.
How to get education loan to study abroad without collateral
If you want to take a loan from a bank to pursue higher education abroad and want to know what things the bank can provide you a loan for, then it is as follows:
Under Abroad Loan, you will be provided with a loan by including expenses such as school or college fees and hostel fees, laboratory fees, equipment, instrument fees, library and laboratory fees, fees for purchasing uniforms, study tour fees, project work fees, travel fees for studying abroad, tuition fees, thesis fees, etc.
What are the expenses involved in foreign education loan by the bank?
The following expenses may be included in a foreign education loan by the bank:
- Tuition fees for education
- Hostel fees or rent for living abroad
- Library fees and laboratory fees for expenses
- Fees for uniforms and books for school and college
- Travel and tour fees during studying abroad
- Fees for modified projects or theses
- Representative expenses in foreign countries, such as language study or other courses
- Payment of grants, such as foreign scholarships or stipends
These expenses may vary for different banks and depend on their rules and conditions.
What Expenses are Covered in Education Loan for Abroad Studies
The following expenses may be included in a foreign education loan by the bank:
– Tuition fees for education
– Hostel fees or rent for living abroad
– Library fees and laboratory fees for expenses
– Fees for uniforms and books for school and college
– Travel and tour fees during studying abroad
– Fees for modified projects or theses
– Representative expenses in foreign countries, such as language study or other courses
– Payment of grants, such as foreign scholarships or stipends
These expenses may vary for different banks and depend on their rules and conditions.
Documents required for Education Loan for Abroad Studies by Indian Government
1. Student’s identity proof.
2. Birth certificate.
3. Academic record.
4. Relationship proof with the parents or legal guardians who are taking the loan.
5. It is mandatory to submit the income and address proof of the parents or guardians who are taking the loan.
6. A copy of the admission letter from the college where the student wants to take admission for studying abroad is highly essential.
7. Copies of test scores such as GRE, GMAT, and travel-related documents must be submitted.
8. It is mandatory to have a bank account with the bank from which you want to take the education loan to study abroad, to make the loan process easier.
It is important to note that these documents may vary depending on the specific requirements of the bank or financial institution, and students should check with the institution for a complete list of required documents.
Documents required from co-applicant:
- age proof
- ID proof
- Signature proof
- Address proof
- Employment or business or income ratio
Income Proof Requirements of Co-Applicant
Salaried (Any One)
- Last 3 months salary slip
- Account statement of last 3 months along with salary
If in lieu of salary, some other income like- rent, business, pension, agriculture etc. can also be received – but in the form of document proof.
SEP & SENP – Accounts for last 2 years Accounts for last 2 years or P&L & Bs certified by CA.
Others –
Income certificate from a competent authority
in case of education loan for studies abroad.
Guarantor in bank for Education Loan
In most banks, there is no need for a guarantor for education loans up to approximately four lakh rupees, but for loans above this amount, you need a guarantor. You can make your relatives or friends guarantor, whom the bank trusts, in most banks.
For studying in India, loans up to 5-15 lakh rupees are available, and for studying abroad, loans up to 20-25 lakh rupees are available. With the help of a guarantor, you can easily get a loan of 4-7.5 lakh rupees, but for loans above this amount, you will need to submit your property papers as collateral to the bank.
The interest rate on education loans taken for studying abroad.
1. The interest rates vary for education loans from different government and private banks, while the interest rate for educational loans is typically between 11 to 14 percent, some banks may charge even higher rates. Additionally, many banks provide interest rate discounts for students.
2. Some banks also charge processing fees of up to two percent on the loan amount for student loans.
3. For all types of student loans, tax exemptions are provided under Section 80E of the Income Tax Act, 1961 for interest payment.
Which collateral does the bank accept for education loan abroad?
- The types of securities accepted by banks in India are as follows:
- In immovable property – House, flat, apartment, and a plot with a boundary.
- In liquid assets – LIC policy or a fixed deposit and government bonds, etc.
Which bank gives loan for studying abroad?
Here is a list of some banks in India that offer education loans for studying abroad:
- Syndicate Bank Education Loan
- Vijaya Bank study abroad loan
- Nbp study abroad loan
- Vidya Lakshmi Portal
- ICICI study abroad loan
- Bank of Baroda Education loan for abroad
- Ubl study abroad loan
- Canara Bank Education Loan
- Avanse study abroad loan
- Hdfc Education loan for abroad
- IDBI study abroad loan
- Allahabad Bank study abroad loan
- IOB study abroad loan
Please note that this is not an exhaustive list and there may be other banks that also offer education loans for studying abroad.
Education Loan Interest Rates to Study Abroad
Here are some banks in India that offer education loans for studying abroad along with their current interest rates as of my knowledge:
- State Bank of India (SBI) – 7.45% to 9.05%
- Punjab National Bank (PNB) – 7.35% to 8.60%
- Axis Bank – 8.55% to 10.50%
- HDFC Bank – 8.45% to 10.15%
- ICICI Bank – 8.45% to 10.55%
- Canara Bank – 7.80% to 9.30%
- Bank of Baroda (BOB) – 6.85% to 10.25%
- Union Bank of India – 6.80% to 8.90%
- Indian Overseas Bank (IOB) – 6.75% to 9.05%
- IDBI Bank – 8.25% to 9.25%
- Central Bank of India – 6.85% to 8.85%
- Syndicate Bank – 8.50% to 9.25%
- Andhra Bank – 8.55%
- Karur Vysya Bank – 12.90%
- South Indian Bank – 10.50%
Please note that interest rates can vary based on various factors such as loan amount, repayment tenure, collateral security, credit score, etc. It is always advisable to check with the bank for the latest interest rates and other terms and conditions.
FAQ for Education Loan For Abroad
Q: What is an education loan for abroad?
A: An education loan for abroad is a loan provided by banks or financial institutions to fund the expenses of a student studying overseas.
Q: Who is eligible to apply for an education loan for abroad?
A: Any Indian citizen who has secured admission to a recognized university or college abroad and has a co-signer as a guarantor can apply for an education loan for abroad.
Q: What expenses are covered by an education loan for abroad?
A: An education loan for abroad covers tuition fees, travel expenses, accommodation charges, and other related expenses incurred during the course of study.
Q: What is the repayment period for an education loan for abroad?
A: The repayment period for an education loan for abroad usually ranges from 5 to 15 years, depending on the amount borrowed and the terms of the loan.
Q: Can the interest rate on an education loan for abroad be negotiated?
A: No, the interest rate on an education loan for abroad is determined by the bank or financial institution and cannot be negotiated.
Q: Can a student apply for an education loan for abroad without a co-signer?
A: No, a co-signer is mandatory for an education loan for abroad, as they act as a guarantor for the loan.
Q: Is collateral required for an education loan for abroad?
A: Depending on the loan amount, some banks may require collateral or a co-signer as a guarantor.
Q: How long does it take to process an education loan for abroad?
A: The processing time for an education loan for abroad may vary from bank to bank, but generally, it takes 2-4 weeks to process the loan application.
Q: What happens if a borrower is unable to repay an education loan for abroad?
A: If a borrower is unable to repay the education loan for abroad, the co-signer becomes responsible for the repayment, and the bank can seize the collateral or take legal action against the borrower and co-signer.
Q: Is it possible to get a tax deduction on the interest paid on an education loan for abroad?
A: Yes, under Section 80E of the Income Tax Act, the interest paid on an education loan for abroad is tax-deductible for up to 8 years.
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