In the recent years, education loans have become a powerful tool in rural India’s pursuit of academic and economic advancement. An increasing number of students from villages and semi-urban regions are taking financial assistance to attain higher education both within India and abroad.
According to recent data from the Reserve Bank of India, education loan disbursement rates have surged in the last few years with a remarkable 17% growth in education loans during 2022-23. In this, rural and semi-urban borrowers have accounted for a growing percentage of this uptick.
Taking Education Loans is not only enabling students to realize their academic dreams but also reshaping perspectives on education as a strategic investment for future prosperity. This paradigm shift is driven by numerous factors.
Exclusive Loan Schemes & Competitive Interest Rates: Banks are designing exclusive education loan schemes that cater specifically to students from low-income backgrounds, offering lower interest rates and simplified application processes. Such schemes are not just for students aiming to study in India but abroad as well. In addition to this, financial institutions are increasingly providing flexible repayment terms that consider the varied financial backgrounds of rural applicants.
So, students from rural India are checking out for the best education loans in India for study abroad or for higher education in India.
Government Schemes & Subsidies: Government support, including subsidies and interest rate reductions, is significantly boosting the affordability of education loans. For instance, under the Education Budget 2024-25, the government has pledged financial aid of up to INR 10 lakhs for students pursuing higher education in Indian institutions. An added 3% interest subvention further eases the financial burden, making education loans even more accessible to rural students and their families.
Beyond this, the Government has lowered the TCS rates for Overseas Education Loans. As per the latest norms, the TCS rate for study abroad loans will now be just 0.5% above INR 7 lakhs as compared to self-funding for which the TCS rate is 5%.
Though there may not be specific schemes of education loan for abroad studies by Indian government, the lower TCS aspect does help the students from rural areas as well as urban areas.
Digitalisation & Simplified Application Process: Digital transformation within the banking sector has simplified loan application processes. This allows students from remote areas to apply for loans online without having to visit bank branches repeatedly. The easy accessibility and a digitalised loan support system have made education loans accessible to more students than ever before.
This shift has opened a new realm of possibilities, where education loans facilitate not only domestic education but also opportunities in foreign universities.
As rural India constitutes around 63.64% of the country’s population, this education revolution powered by loans marks a transformative shift in the socio-economic landscape. More parents and students are now fully aware of the opportunities available and see the strategic value in investing in education through loans.
For students seeking financial assistance for their overseas education, Expert Loan Advisors at Élan Overseas Education Loans are at your service. Our goal is to assist you every step of the way, making sure that your educational aspirations are well within reach. Keep checking our website for more such latest updates on education loans for abroad studies, scholarships, and other essentials for your academic journey abroad.
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