Overseas education loans have become essential for students aiming to pursue higher studies abroad. With the continuous rise in international tuition fees, living expenses, travel costs, insurance, and academic resources, many aspiring students depend on study abroad education loans to fund their global education journey. These loans are structured to cover all major expenses, ensuring students can focus on building their academic and career goals without financial burden.
Leading financial institutions—such as public and private sector banks, NBFCs, and international education loan providers—offer customized loan products designed specifically for overseas studies. These overseas education loans come with flexible repayment plans, competitive interest rates, longer moratorium periods, and quick approval processes, making global education more accessible than ever. By offering financial support, these loans enable students from diverse backgrounds to gain admission to top universities abroad and explore global career opportunities.
Choosing the right study abroad loan plays a crucial role in turning international education dreams into reality.
1. Why Students Need Education Loans for Studying Abroad
Pursuing higher education abroad requires careful financial planning, as international tuition fees and living expenses are significantly higher compared to domestic education costs. In this scenario, education loans for abroad studies play a crucial role by offering students the financial support needed to cover major expenses such as tuition, accommodation, travel, insurance, study materials, and other academic essentials.
With challenges like currency fluctuations, rising university fees, and the high cost of living in countries such as the USA, UK, Canada, and Australia, many families struggle to manage these expenses upfront. Overseas education loans bridge this gap by providing structured financial solutions with flexible repayment options, competitive interest rates, and extended moratorium periods, enabling students to begin repayment only after completing their education.
Beyond covering finances, study abroad loans empower students to access globally recognized universities, competitive international programs, and better career opportunities. By easing the financial burden on families, these loans help students focus on achieving their long-term academic goals and building successful global careers.
2. Types of Overseas Education Loans Available
| Type of Education Loan | Description | Ideal For | Key Features |
|---|---|---|---|
| Secured Education Loan (With Collateral) | Loan granted against collateral such as property, fixed deposits, or government bonds. | Students seeking higher loan amounts at lower interest rates. | Lower interest rates, higher loan limits, longer repayment tenure, and stronger approval chances. |
| Unsecured Education Loan (Without Collateral) | Loan provided without the need for any security or collateral. | Students who do not have property or assets to pledge. | Faster processing, higher interest rates, loan amount based on academic profile and co-applicant income. |
| Government-Backed Education Loans | Loans offered under government schemes for eligible students. | Economically weaker sections or students choosing approved institutions. | Subsidised interest rates, income-based eligibility, interest subsidy during moratorium. |
| Bank Education Loans (Public & Private Sector Banks) | Standard study-abroad loans provided by banks. | Students seeking reliable funding with regulated interest rates. | Competitive interest rates, transparent terms, wide coverage for countries and courses. |
| NBFC Education Loans | Loans offered by Non-Banking Financial Companies specifically for overseas education. | Students needing quick approval or higher loan amounts for premium universities. | Quick processing, flexible documentation, country-specific and university-specific loan products. |
| International Lender Loans | Loans offered by global lenders for studying abroad, especially in the US, UK, and Europe. | Students enrolling in top universities with strong academic profiles. | No co-signer required in some cases, variable interest rates, designed for international students. |
| University-Partnered Loan Programs | Loans facilitated by universities partnered with financial institutions. | Students of universities offering tie-ups for loan support. | Simplified approval, pre-approved amounts, institution-backed financial assistance. |
| Bridge Loans / Pre-Visa Loans | Short-term loans offered before visa approval for immediate payments. | Students needing funds for application fees, initial deposits, or proof of funds. | Quick sanction, short tenure, converts to long-term loan after main loan approval. |
3. PM-Vidyalakshmi
- What It Is: A government-backed scheme to provide collateral-free and guarantor-free education loans to students admitted on merit to Quality Higher Education Institutions (QHEIs) in India. Education Government of India+2Business Today+2
- Interest Subvention: Students from families with annual income up to ₹ 8 lakh can get a 3% interest subsidy on loans up to ₹ 10 lakh during the moratorium (course + 1 year). Education Government of India+1
- Credit Guarantee: For loans up to ₹ 7.5 lakh, there is a 75% credit guarantee on default, reducing risk for banks. mint
- Repayment: Up to 15 years tenure for repayment, excluding moratorium. Education Government of India+1
- Application Process: Entirely digital. Students apply through the PM-Vidyalaxmi portal, which provides a simplified application form. National Law School of India University
- Portal & Website: You can apply and get more information at PM-Vidyalaxmi Portal: pmvidyalaxmi.co.in National Law School of India University+1
- Important Caution: The portal does not ask for any payment. Beware of fraudulent sites or messages asking for money. Vidyalakshmi
SC / ST Education Loan or Subsidy Details
There isn’t a single central “SC/ST education loan scheme”, but rather multiple government-run schemes (and state-level) that benefit SC / ST students. Here are some key related ones:
1. Central Sector Interest Subsidy (CSIS) Scheme
- Under the Department of Higher Education, some students (including SC/ST) may be eligible for full interest subsidy during the moratorium. Education Government of India
- This is part of the PM-USP Yojana (Pradhan Mantri Uchchatar Shiksha Protsahan). Education Government of India
- Applicable for education loans without collateral up to a certain limit. Education Government of India
2. State / Regional SC / ST Loan Schemes
| State | Scheme Name | Target Group | Key Benefits / Coverage | Eligibility & Notes | Source / Link |
|---|---|---|---|---|---|
| Telangana | Ambedkar Overseas Vidya Nidhi (SC) | SC students | Scholarship up to ₹20 lakh for overseas studies; 1-way economy ticket + visa charges. | Family income ≤ ₹2.00 lakh/year. 60% in graduation + valid GRE/GMAT + English test. Only 1 child per family. (Scholarships) | Telangana ePASS – Overseas Links (Telangana ePass) |
| Telangana | Ambedkar Overseas Vidya Nidhi (ST) | ST students | Scholarship up to ₹20 lakh (or as per admission letter), covers visa and ticket. | Family income ≤ ₹5.00 lakh. 60% in graduation, required GRE / GMAT / IELTS / TOEFL. (Sakshi Education) | Telangana ePASS – Overseas Links (ST) (Telangana ePass) |
| Andhra Pradesh | Ambedkar Overseas Studies Nidhi | ST students | Financial assistance (grant + loan) for postgraduate and doctoral studies abroad. | Income ≤ ₹2.50 lakh/year, age ≤ 35 years, ≥ 60% in qualifying degree. (ITDA Hyderabad) | AP Social Welfare / SC-ST Education Assistance (Social Welfare) |
| Kerala | Kerala SC/ST Scholarship for Overseas Studies | SC / ST students | Scholarship support for “academically brilliant” SC/ST students admitted to foreign universities. | Guidelines specified by Kerala SC/ST Development Department. (Tribal Development Dept.) | Kerala ST / SC Scholarship Guidelines (PDF) (Tribal Development Dept.) |
| Tamil Nadu | Adi Dravidar / Tribal Overseas Scholarship | SC / ST students | Up to ₹36 lakh per annum for tuition, living, visa, and airfare. (The Times of India) | Family income eligibility raised to ₹12 lakh/year. (The Times of India) | Times of India – TN Overseas SC/ST Scholarship (The Times of India) |
| Karnataka | Overseas Scholarships for SC/ST Students | SC / ST students | Financial assistance for Master’s and PhD abroad; covers full tuition + maintenance / travel / insurance. | Reinstated for PhD with conditions: SC only; must work 2 years in India after PhD. (The News Minute) | NewsMinute – Karnataka Overseas PhD Scholarships (The News Minute) |
4. Secured vs. Unsecured Education Loans
| Category | Secured Education Loan (With Collateral) | Unsecured Education Loan (Without Collateral) |
|---|---|---|
| Definition | Loan offered against collateral such as residential property, fixed deposits, LIC policies, or government securities. | Loan provided without requiring any collateral or security. |
| Loan Amount | Higher loan limits (often ₹50 lakh to ₹1.5 crore, depending on lender and collateral value). | Moderate loan amounts (typically ₹7.5 lakh to ₹60 lakh, based on profile and lender). |
| Interest Rates | Lower and more stable interest rates due to reduced lender risk. | Higher interest rates because no security is pledged. |
| Approval Chances | High approval probability if collateral is acceptable and properly documented. | Approval depends heavily on academic profile, co-applicant income, credit score, and university ranking. |
| Processing Time | Longer due to property evaluation, legal verification, and collateral assessment. | Faster approval as no collateral verification is needed. |
| Co-applicant Requirement | Usually required but income strength may be flexible due to collateral support. | Mandatory; strong income and credit history are crucial. |
| Repayment Tenure | Longer repayment period, often up to 15 years. | Slightly shorter repayment period, typically 7–10 years. |
| Risk to Borrower | Risk of losing collateral if loan is not repaid. | No property risk; however, default affects credit score of student and co-applicant. |
| Suitable For | Students needing large loan amounts for premium universities or long-duration programs. | Students without assets to pledge or those needing quick loan approval. |
| Typical Lenders | Public sector banks, private banks, some NBFCs. | NBFCs, private banks, and international lenders. |
5. Eligibility Criteria for International Student Loans
To qualify for an overseas education loan, applicants must meet specific academic, financial, and documentation requirements set by banks and NBFCs. The key eligibility conditions include:
- The applicant must be an Indian citizen and meet the lender’s residency and documentation requirements.
- A valid admission letter from a recognised foreign university or institution is mandatory for loan processing.
- Applicants should demonstrate consistent academic performance in previous studies.
- The chosen program must be a full-time, lender-approved course at an accredited international institution.
- Valid test scores such as IELTS, TOEFL, PTE, GRE, or GMAT may be required depending on the course and country.
- A financially stable co-applicant—such as a parent or guardian—with a reliable income and credit profile is essential.
- The co-applicant must hold a satisfactory CIBIL score and meet the lender’s creditworthiness criteria.
- Acceptable collateral such as property, fixed deposits, or LIC policies may be required for secured education loans.
- The applicant must meet the lender’s minimum and maximum age requirements.
- The selected country, university, and course should be part of the lender’s approved list for overseas education loans.
- All mandatory academic, financial, income, and KYC documents must be submitted for loan evaluation and approval.
6. Key Documents Required for Loan Application
- Completed Loan Application Form
- Passport-Size Photographs of Applicant and Co-applicant
- Proof of Identity: Aadhaar Card, PAN Card, or Passport
- Proof of Residence: Aadhaar Card, Voter ID, Passport, or Utility Bills
- Academic Documents: Mark sheets, certificates, and transcripts from Class 10 onwards
- Entrance Exam Scores: IELTS, TOEFL, PTE, GRE, or GMAT (if applicable)
- Admission Letter: Offer letter or acceptance letter from the foreign university
- Course Fee Structure: Official fee breakdown from the institution
- Bank Statements: Recent 6–12 months’ bank statements of the co-applicant
- Income Proof of Co-applicant: Salary slips, IT returns, Form 16, or business financials
- Collateral Documents (For Secured Loans): Property papers, valuation reports, ownership proof
- Passport Copy of the Applicant
- Statement of Purpose (SOP): If required by certain lenders
- Any Additional Documents: As requested by the bank or financial institution
7. Loan Amount, Margin Money, and Coverage Details
| Category | Secured Education Loan | Unsecured Education Loan | Analysis / Key Insight |
|---|---|---|---|
| Typical Loan Amount | ₹50 lakh to ₹1.5 crore+ (depending on collateral value) | ₹7.5 lakh to ₹60 lakh (based on profile and lender) | Secured loans offer significantly higher funding, suitable for high-cost destinations like the USA, UK, and Canada. |
| Margin Money Requirement | 0% to 10% (varies by bank; PSBs usually lower) | 10% to 20% (varies by lender and profile) | Secured loans generally require less margin money, reducing upfront costs for families. |
| Coverage of Tuition Fees | Up to 100% coverage | 80% to 100%, depending on credit strength | Both options can cover full tuition, but unsecured loans may limit high-fee programs. |
| Coverage of Living Expenses | Fully covered, including rent, food, utilities | Covered but sometimes capped based on loan limit | Students in expensive countries may prefer secured loans for full coverage. |
| Coverage for Travel & Visa Costs | Usually included | Included but restricted with lower loan amounts | Secured loans provide more flexibility for additional expenses. |
| Coverage for Books, Laptop & Study Materials | Fully covered as part of total loan | Covered but may be capped | Both loan types support academic essentials. |
| Insurance Coverage | Generally included or optional | Included or optional depending on lender | Some lenders make student travel insurance compulsory. |
| Overall Flexibility | High flexibility due to collateral support | Moderate flexibility depending on student/co-applicant profile | Secured loans offer more relaxed eligibility and wider coverage. |
8. Interest Rates and Repayment Terms
| Category | Secured Education Loan | Unsecured Education Loan | Professional Insight |
|---|---|---|---|
| Interest Rate Range | Typically8.5% – 11% per annum | Typically 11.5% – 15.5% per annum | Secured loans offer lower rates due to reduced lender risk. |
| Type of Interest Rate | Fixed or floating; floating is common | Mostly floating interest rates | Floating rates fluctuate with market conditions. |
| Moratorium Period | Course duration + 6–12 months | Course duration + 6–12 months | Both loans offer a study-period relief before EMI starts. |
| Repayment Tenure | Up to 15 years | Usually 7–10 years | Secured loans offer a longer repayment window. |
| Repayment During Study | Partial/simple interest or optional interest payment | Simple interest payment often mandatory | Unsecured loans may require higher payments during study. |
| EMI Flexibility | High flexibility due to collateral security | Moderate flexibility based on income and profile | Secured loans allow more relaxed EMI planning. |
| Prepayment Charges | Rarely charged by banks | NBFCs may levy charges | Always review prepayment policies in advance. |
| Penalty on Late EMI | Standard banking norms | Higher penalties in some NBFCs | Unsecured loans may attract stricter penalty terms. |
| Overall Cost of Borrowing | Lower due to reduced interest rate and longer tenure | Higher due to increased lending risk and shorter tenure | Borrowers must evaluate long-term affordability. |
9. Co-applicant and Guarantor Requirements
- A co-applicant is mandatory for most overseas education loans.
- Acceptable co-applicants typically include parents, siblings, spouses, or legal guardians.
- The co-applicant must have a stable and verifiable source of income.
- A satisfactory CIBIL score and strong credit history are required for loan approval.
- The co-applicant must provide complete financial documents such as salary slips, IT returns, and bank statements.
- For secured loans, the co-applicant’s income requirement may be flexible due to collateral support.
- For unsecured loans, the co-applicant’s financial strength significantly affects the loan amount and interest rate.
- Some lenders may also require a third-party guarantor for higher loan amounts.
- Guarantors must meet the lender’s income and credit criteria and provide relevant documentation.
- The co-applicant must be included in the loan agreement and is legally responsible for repayment along with the borrower.
10. Application Process: Step-by-Step Guide
- Identify eligible loan schemes based on your study destination, course, and financial background.
- Compare lenders (banks, NBFCs, government portals) for interest rates, processing time, and coverage.
- Check the lender’s eligibility criteria such as academic performance, co-applicant income, and credit score.
- Gather required documents, including admission letters, academic records, financial statements, and ID proofs.
- Create an online application on the lender’s portal or visit the nearest bank branch for offline submission.
- Upload or submit all documents as per the prescribed format for initial verification.
- Attend the lender’s evaluation, including credit checks, co-applicant verification, and property assessment (for secured loans).
- Complete any additional compliance, such as signing declarations, providing guarantor details, or clarifying financial proofs.
- Receive loan sanction letter outlining approved amount, interest rate, and repayment terms.
- Submit the sanction letter to your university or for visa processing, if required by the institution.
- Complete loan agreement formalities, including signing the loan contract and submitting post-dated checks or e-mandates.
- Disbursement begins—funds are released directly to the university or to your account as per the lender’s guidelines.
11. Pre-Visa and Post-Visa Loan Disbursement
- Pre-Visa Disbursement:
Banks release partial funds before the visa to cover initial expenses such as university seat confirmation, tuition advance, or GIC/blocked account payments (for countries like Canada or Germany). - Post-Visa Disbursement:
The remaining loan amount is disbursed after visa approval, usually directly to the university, covering tuition, living expenses, insurance, and other approved costs. - Institution-Specific Conditions:
Some banks require a valid visa, I-20/CAS, or admission letter before releasing full funds. - Disbursement Mode:
Funds are transferred semester-wise or yearly, depending on university billing and bank policies. - Compliance Checks:
KYC, fee structure verification, and loan agreement signing are mandatory before each disbursement stage.
12. Bank vs. NBFC vs. International Lender Options
Banks (Public & Private)
- Offer lower interest rates compared to NBFCs.
- Provide secured and unsecured loan options, but higher amounts usually require collateral.
- Have strict eligibility checks, especially for co-applicants’ income and academic background.
- Offer longer repayment tenures and eligibility for government interest-subsidy schemes.
Non-Banking Financial Companies (NBFCs)
- Provide faster approvals and flexible documentation.
- Offer higher unsecured loan amounts compared to banks.
- Have higher interest rates, often with floating or risk-based pricing.
- Ideal for students with moderate academics or limited collateral.
International Lenders (e.g., MPOWER, Prodigy Finance)
- Offer loans without collateral and without co-applicant for selected universities abroad.
- Interest rates are generally higher and based on international benchmarks (SOFR/Libor).
- Disbursement is direct to the university in foreign currency.
- Best for students with strong admission profiles to top-ranked institutions.
13. How to Improve Your Chances of Loan Approval
Follow these steps to strengthen your loan application:
- Maintain a strong academic profile — Ensure consistent grades and competitive test scores (IELTS/TOEFL, GRE/GMAT).
- Choose recognized universities — Shortlist institutions approved by major banks and lenders.
- Prepare a clear financial plan — Show clear estimates of tuition, living expenses, and your repayment ability.
- Strengthen your co-applicant profile — Ensure the co-applicant has stable income, strong credit history, and proper documentation.
- Improve CIBIL score (if applicable) — maintain a score above 700 through timely payments and low credit utilisation.
- Organise documents accurately — Submit complete and error-free documents, including admission letters, KYC, income proofs, and collateral papers (if secured loan).
- Demonstrate stable income sources — Provide consistent salary slips, ITR filings, and bank statements for the co-applicant.
- Select an appropriate loan type
- Choose secured loans if collateral is available to improve approval chances and interest rates.
- Select the loan type that suits your profile.
- Prefer a secured loan if you have collateral.
- Use collateral to increase approval chances.
- Avoid multiple loan applications simultaneously — Too many applications reduce credit score and appear risky to lenders.
- Provide a strong Statement of Purpose (if required) — Present a clear academic and career goal aligned with your chosen program.
- Ensure collateral clarity (for secured loans) — Provide legally clear, dispute-free property documents to speed approval.
- Communicate transparently with the lender — Respond promptly to queries and provide additional documents when required.
14. Common Challenges Faced by Students and Solutions
Challenges & Solutions
- High Interest Rates
Solution: Compare banks, NBFCs, and government-subsidised schemes; opt for secured loans when possible. - Low CIBIL Score of Co-applicant
Solution: Add a secondary co-applicant or choose lenders that accept alternative financial profiles. - Insufficient Collateral Value
Solution: Apply for partial-collateral loans, add additional property, or explore unsecured loan options with strong academic profiles. - Delayed Loan Sanction
Solution: Start the application early, keep documents updated, and respond quickly to lender queries. - Loan Rejection Due to Course or Country
Solution: Select recognised universities and approved courses that meet lender eligibility norms. - Funding Gap for Living Expenses
Solution: Request top-up loans, explore part-time work regulations, or apply for scholarships alongside the loan. - Confusion about Loan Disbursement Rules
Solution: Clarify pre-visa and post-visa disbursement policies with the lender before signing. - Difficulty Providing Income Proof of Co-applicant
Solution: Use alternative income documentation (ITR statements, business proof, rental income), if applicable. - Currency Exchange Fluctuation Risk
Solution: Maintain buffer funds and choose lenders offering Forex protection or multi-currency disbursement options. - Understanding Repayment Obligations
Solution: Request an amortisation schedule, understand moratorium benefits, and choose flexible repayment plans.
15. Important Tips for Financial Planning Before Studying Abroad
- Estimate your total cost of education
Calculate tuition fees, living expenses, accommodation, insurance, travel, books, and miscellaneous costs for the entire duration of study. - Create a realistic personal budget
Plan monthly spending based on the destination’s cost of living and adjust for currency fluctuations. - Compare funding options early
Evaluate bank loans, NBFC loans, scholarships, grants, sponsorships, and part-time work opportunities. - Maintain a strong academic and financial profile
Good grades, confirmed admission, and stable co-applicant income improve funding access and loan terms. - Start loan processing well in advance
Apply 3–6 months before your course start date to avoid delays in admission or visa timelines. - Keep emergency funds ready
save at least 3–6 months of living expenses for unexpected situations or initial settlement costs. - Understand currency exchange trends
Track exchange rates and plan remittances wisely to reduce financial burden. - Review repayment obligations
Assess EMI amounts, repayment tenure, moratorium conditions, and interest rates for long-term financial comfort. - Use student discounts and cost-saving opportunities
Leverage university benefits, public transport passes, shared housing, and student-priced services. - Get adequate health and travel insurance
Ensure coverage for medical expenses, emergencies, and unforeseen circumstances abroad. - Manage finances digitally
Set up international banking, student accounts, online transfers, and payment cards for easy and safe transactions. - Plan for part-time or on-campus work
Verify visa rules for working hours and explore assistantships or internships to supplement income.
16. Mistakes to Avoid When Applying for an Education Loan
- Applying without comparing lenders
Avoid selecting the first lender you find. Compare interest rates, processing fees, moratorium benefits, coverage, and service quality. - Ignoring eligibility requirements
Do not apply without checking academic, financial, and co-applicant eligibility, as this leads to unnecessary rejections. - Submitting incomplete or inconsistent documents
Ensure all documents—income proofs, KYC, academic records, and admission letters—are accurate, updated, and properly aligned. - Underestimating the total cost of education
Never calculate only tuition fees. Include living costs, insurance, travel, visa fees, and emergency expenses to avoid funding gaps later. - Choosing the wrong loan type
Avoid opting for an unsecured loan when collateral is available, as it may lead to higher interest rates and stricter conditions. - Not preparing the co-applicant’s financial profile
Failure to verify the co-applicant’s credit score, income stability, and banking records can delay or derail approval. - Overlooking the loan’s fine print
Do not ignore hidden charges, prepayment terms, interest calculation methods, and repayment rules. - Applying at the last minute
Loan approvals take time. Avoid delays by starting the process immediately after receiving your admission letter. - Misjudging currency exchange fluctuations
Avoid planning funds based on today’s exchange rate; always account for potential fluctuations in foreign currency values. - Accepting more loan amount than required
Borrow only what you need. Excessive borrowing increases long-term debt and repayment pressure. - Depending solely on one lender
Avoid limiting yourself to a single bank’s decision. Always keep backup options such as NBFCs or international lenders. - Ignoring scholarship and grant opportunities
Do not rely entirely on loans. Scholarships can significantly reduce the loan burden and improve financial stability. - Delaying communication with the lender
Avoid slow responses to clarifications, queries, or document requests, as this can slow down sanction and disbursement. - Not planning repayment beforehand
Avoid waiting until after graduation to think about EMI planning. Understanding future repayment obligations builds financial discipline.
Frequently Asked Questions (FAQs) — Overseas Education Loans (2025)
1. What is an overseas education loan?
An overseas education loan is financial assistance offered by banks or lenders to cover tuition fees, living expenses, travel, insurance and other study-related costs for international education.
2. Who can apply for an international education loan?
Students who have secured admission to a recognised foreign university or program and meet the bank’s eligibility criteria can apply.
3. Do all banks fund education abroad?
Most nationalised banks, private banks, NBFCs and some international lenders offer loans specifically designed for studying overseas.
4. What is the maximum loan amount available?
Loan amounts vary; banks typically offer up to ₹1.5 crore for top global universities, depending on program, country and collateral.
5. What expenses are covered under an education loan?
Coverage includes tuition fees, accommodation, living expenses, travel, visa charges, insurance, books and sometimes laptops or study equipment.
6. What is the difference between secured and unsecured loans?
Secured loans require collateral; unsecured loans are based on creditworthiness and income profile of the co-applicant.
7. Can students get loans without collateral?
Yes, unsecured loans are available up to a limit, depending on the student’s profile, course, and university ranking.
8. Who can be a co-applicant?
Parents, siblings, spouse or legal guardians can act as co-applicants depending on lender guidelines.
9. What documents are required for loan approval?
Common documents include KYC, admission letter, fee structure, academic records, financial proofs and collateral documents (for secured loans).
10. How long does the loan approval process take?
Typically 7–21 working days, depending on lender type and document completeness.
11. Are pre-visa disbursements available?
Yes. Many lenders provide partial disbursement for visa proof of funds, tuition deposits or financial capacity.
12. What is a moratorium period?
It is the period during which students are not required to repay the principal amount—usually course duration plus 6–12 months.
13. How are interest rates determined?
Rates vary based on loan type, collateral availability, lender policies and the borrower’s financial profile.
14. Are there any government schemes for education loans?
Yes, schemes like PM Vidyalakshmi, CSIS interest subsidy and state-based SC/ST financing initiatives provide additional benefits.
15. What are common reasons for loan rejection?
Insufficient income, weak credit history, inconsistent documentation or low-rank universities may cause rejection.
16. Can loans be repaid early?
Yes, most banks allow prepayment with minimal or no penalty.
17. Do lenders require insurance?
Many lenders mandate student travel and health insurance as part of the loan package.
18. Are job-linked repayment options available?
Yes, some NBFCs and global lenders offer flexible repayment plans linked to post-study employment.
19. Can the loan amount be increased later?
Some lenders allow top-up loans depending on academic performance and additional financial requirement.
20. How are funds disbursed?
Disbursement is made directly to the university or into the student’s account based on the fee schedule.
21. Can parents claim tax benefits?
Yes, under Section 80E, interest paid on education loans qualifies for tax deduction.
22. Do banks consider part-time or online programs?
Loans are typically approved only for full-time, recognised, on-campus programs abroad.
23. Are loans available for diploma or vocational programs abroad?
Yes, several lenders fund skill-oriented international diploma programs based on country and institute ranking.
24. Can students reapply after a loan rejection?
Yes, students can reapply with stronger documentation, an additional co-applicant, or improved collateral support.
25. How can GHC Education help in the loan process?
GHC Education provides end-to-end guidance—loan selection, eligibility assessment, documentation support and coordination with lenders.
Disclaimer:
This information is for guidance purposes only; students should verify exact terms directly with banks or authorised financial institutions.
