Which bank is best for education loan for abroad?

Studying abroad is a dream come true for many students, offering the chance to experience new cultures and access quality education. However, the challenge lies in Financing this dream. Education loans often come with their own set of hurdles, such as visa requirements and varying loan specifications.

In this article, we will explore the different aspects of education loans for studying abroad and compare some of the top banks in India that offer these services.

Factors to Consider When Choosing an Education Loan Provider

When selecting an education loan provider, it's crucial to weigh various factors that can impact your borrowing experience and overall financial health. Understanding these factors will help students make informed decisions and choose the most suitable loan option. 

Here, we delve deeper into these factors and explain their significance.

• Loan amount (secured and unsecured loans): The loan amount you require depends on the course fees, living expenses, and other related costs. It's essential to choose a bank that can offer the desired loan amount, both in terms of secured (with collateral) and unsecured (without collateral) loans. Finding a provider that meets your financial needs can help avoid additional borrowing or financial strain during your studies.


• Time is taken to sanction and disburse the loan: Timely loan disbursement is crucial for meeting application deadlines, visa requirements, and other time-sensitive matters. A loan provider with a faster approval and disbursement process can ensure you meet these obligations without undue stress or complications.


• Interest rate: The interest rate on your education loan directly impacts the total cost of borrowing. A lower interest rate can save you a significant amount over the loan tenure. It's important to compare and know which bank has lowest interest rate on education loan.


• Loan tenure: The loan tenure, or repayment period, affects your monthly installment amount and the overall interest paid. A longer tenure can reduce your monthly payments but may increase the total interest paid. Consider your future earning potential and financial goals to determine the most suitable tenure.


• Moratorium period: A moratorium period is a duration during which you're not required to make loan repayments. This period usually covers the course duration and a few months after course completion. A longer moratorium period can offer financial relief while you're studying and searching for a job, allowing you to focus on your education and career development.


• Processing charges: Some banks charge a processing fee for handling your loan application. This fee can vary between banks and may impact your overall loan cost. Comparing processing charges among loan providers can help you minimize additional expenses.


• Post visa disbursement: Certain countries require proof of funds before granting a student visa. In such cases, post-visa disbursement is crucial to ensure that the loan amount is available when needed. Opt for a bank that offers this facility to avoid complications in the visa application process.


• Pre-visa disbursement: Some loan providers offer pre-visa disbursement, which means they release a portion of the loan amount before obtaining the student visa. This can be helpful for students who need to pay initial fees or deposits to secure their admission.


• Remittance to university or saving account: Depending on your preference and the specific requirements of your study abroad program, you may want the loan amount to be directly remitted to the university or deposited into a savings account. Choose a bank that can accommodate your preferred method of disbursement to streamline your financial management while studying abroad.

By carefully considering these factors, students can make informed decisions and select the education loan provider that best aligns with their study abroad goals and financial needs.

Note – There are many necessary checks that one must adhere to, one of which is the hidden cost.

Top Education Loan Providers in India

Students often wonder which bank is best for education loan for abroad. Let's take a closer look at the education loan offerings from six preferred and top banking institutions in India, including SBI, Bank of Baroda, Axis Bank, Union Bank, Avanse, and HDFC Credila.

State Bank of India (SBI)

SBI is among the top education loan providers in India, offering loans for studying abroad under its Global Ed-Vantage scheme.

Key features include:

• Loan Amount - Up to INR 1.5 crore with collateral and without collateral it is 7.5 Lacs.
• Interest rate 11.15% p.a. (0.50% - Discount in Girl Concession & 0.50% - Discount in Rin Raksha Insurance)
• Loan tenure – Up to 15 years
• Moratorium period until course completion + 6 months
• Pre and post-visa disbursement options

Bank of Baroda

Bank of Baroda is another leading education loan provider in India. It provides a Baroda Scholar loan scheme for students pursuing higher education abroad.

Key features include:

• Loan Amount - Up to INR 1.5 Cr with collateral and up to INR 7.5 lakhs without collateral.
• Interest rate starting at 10.40 (0.50% - Discount in Girl Concession)
• Loan tenure - Up to 15 years
• Moratorium period until course completion + 12 months
• Pre and post-visa disbursement options
• In terms of collateral 100% of the Realization Value is considered.

Note – Bank of Baroda have a special feature, wherein they have a list of universities as premium listings, and if the university that you are going to comes under it, then you will get benefits such as a better interest rate, find the description below.

Loan Amount - Prime Listing – 1.5 Cr & for Non-Prime Listing – 80 lakhs, and if the property value is good then the loan amount can be higher as well.

Premier University – 10.40 % p.a. & Non-Premier University - 10.75 % p.a. (0.50% - Discount in Girl Concession)

Axis Bank

Axis Bank offers education loans for overseas studies with a range of benefits. Students considering a Union Bank of India education loan might also want to consider Axis Bank's offerings.

Key features include:

• Loan Amount - Up to INR 75 lakhs with collateral and up to INR 40 lakhs without collateral
• Loan Amount - Up to INR 75 lakhs with collateral and up to INR 40 lakhs without collateral
• Interest rate starting at 11.5% p.a.
• Loan tenure - Up to 15 years (Excluding course duration)
• Pre and post-visa disbursement options
• Pre and post-visa disbursement options

Note - Axis Bank has a Prime A and B listing of Universities and in terms of Unsecured loans without property mortgages, one can get up to Rs 40 lakhs for Prime A and up to Rs 25 lakhs for Prime B list Universities.

Union Bank

Union Bank provides education loans for studying abroad under its Union Education scheme. This option is suitable for those looking for an alternative.

Key features include:

• Loan Amount - Secured Loan as per student requirement and Unsecured Loan up to Rs 40 Lakhs.
• Interest rate starting at 11% p.a.
• Loan tenure - Up to 10 years (Including course duration)
• Moratorium period until course completion + 12 months
• Pre and post-visa disbursement options
• Margin – 15% irrespective of the loan amount.

Avanse

Avanse offers customized education loans for students pursuing higher studies abroad. If you are considering an Axis Bank education loan, Avanse might also meet your needs.

Key features include:

• Loan Amount - Secured Loan as per student requirement and Unsecured Loan up to Rs 40 Lakhs.
• Interest rate starting at 11.5% p.a.
• Interest rate starting at 11.5% p.a.
• Moratorium period until course completion + 12 months
• Pre and post-visa disbursement options
• Margin – 100% funding
• Loan Sanction is available before admission on the basis of GRE/TOEFL/IELTS Score.
• Pre Disbursement of loan for getting I20.
• Top-up loans available.
  
  

Note - Their rate of interest is based on the amount of loan you require and other parameters, so approach them or a loan advisor like us who is partnered with Avanse to provide a hassle-free loan application process like us.

HDFC Credila

HDFC Credila, a subsidiary of HDFC Ltd, specializes in education loans for students looking to study abroad. Those searching for competitive HDFC Credila education loan interest rates will find that the bank offers attractive terms.

Key features include:

• Loan Amount - Secured Loan as per student requirement. Unsecured Loan - Up to Rs 75 Lakhs.
• Interest rate starting at 11% p.a.
• Loan tenure - Up to 10 years (Including course duration)
• Moratorium period until course completion + 12 months
• Pre and post-visa disbursement options
• 100% funding – No margin required

Comparing Education Loan Providers: Highlights

Note – In Banking, many changes happen based on the market conditions and other aspects, thus it is advised to either consult the bank or Loan Advisor like us to get complete assistance and answers to your queries.

Eligibility and Required Documents

Eligibility criteria and documentation requirements may vary slightly between banks. In general, applicants must meet the following eligibility requirements:

• Be an Indian citizen
• Have a satisfactory academic record.
• Have a satisfactory academic record.
• Co-applicant (usually a parent or guardian) with a stable income source

Some of the commonly required documents include:

• Admission letter from the foreign institution
• Academic records (mark sheets, certificates, etc.)
• Proof of age, identity, and residence
• Income proof of co-applicant (salary slips, ITR, etc.)
• Collateral documents (if applicable)

When it comes to choosing the best education loan for studying abroad, it's essential to consider factors such as loan amount, interest rate, and loan tenure. Comparing banks and understanding their offerings can help you make an informed decision based on your unique needs. SBI, Bank of Baroda, Axis Bank, Union Bank, Avanse, and HDFC Credila are some of the top education loan providers in India, each offering its own set of advantages. Ultimately, the best choice will depend on your individual circumstances and study abroad goals.

Navigating the world of education loans can be overwhelming, which is why it's essential to have a reliable and knowledgeable advisor by your side. ELAN Loans is your go-to study abroad loan advisor, offering personalized guidance and unbiased expert advice to help you find the perfect loan solution for your overseas education.

Reach out to ELAN Loans today and take the first step towards a brighter future with the ideal education loan tailored to you.

FAQs:

• What factors should be considered when choosing an education loan provider for studying abroad? 

  Factors to consider include the loan amount, the time taken to sanction and disburse the loan, interest rate, loan tenure, moratorium period, processing charges, pre-visa and post-visa disbursement options, and the preferred method of disbursement (direct to university or deposit into a savings account).

• Who are the top education loan providers in India for studying abroad? 

  The top education loan providers in India include SBI, Bank of Baroda, Axis Bank, Union Bank, Avanse, and HDFC Credila. These banks provide various loan options with different features to meet students' needs.

• What is the significance of a moratorium period in an education loan? 

  A moratorium period is a duration during which the student is not required to make loan repayments. This period usually covers the course duration and a few months after course completion. A longer moratorium period offers financial relief while the student is studying and searching for a job.

• What are pre-visa and post-visa disbursements in the context of education loans? 

  Pre-visa disbursement refers to the release of a portion of the loan amount before the student visa is obtained. Post-visa disbursement ensures that the full loan amount is available when needed, especially in countries that require proof of funds before granting a student visa.

• What are the general eligibility criteria for obtaining an education loan for studying abroad in India?

  Generally, applicants must be Indian citizens, have secured admission to a recognized foreign university or institution, have a satisfactory academic record, and have a co-applicant (usually a parent or guardian) with a stable income source.