Dreams of studying abroad often clash with the harsh reality of financial limitations. In such a scenario, enter Union Bank of India and Bank of India the two leading Indian banks determined to bridge this gap with their study abroad loans. These banks are not just offering loans; they're investing in the future of ambitious students.
Union Bank of India (UBI) catches the eye with its competitive rates for top-tier universities and adaptable collateral policies. Meanwhile, the Bank of India (BOI) impresses with its array of concessions and support for various academic levels.
Let's embark on a journey through Union Bank’s and Bank of India education loan interest rate, loan amounts, funding margins, interest rates, and eligibility criteria, arming you with the knowledge to fuel your global academic aspirations.
Here is a close look for loan applicants to compare both the banks and their overseas education loan offerings:
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Key Features
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Union Bank of India
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Bank of India
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Loan Amount
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Secured Loans offered are up to INR 1.5 Cr Unsecured Loans are offered for the Top 160 listed Universities. The loan amount is up to INR 40 Lakhs |
Secured Loan offered are up to INR 1.5 Cr Unsecured Loans are offered for the Top 200 listed Universities. The loan amount is up to INR 20 Lakhs |
| Funding & Margin |
No margin is required with 100% Collateral for Secured loans for Listed and Non-Listed Universities The margin for Secured Loans with 50% Collateral is 15% (On 50% Property Students can avail of the Double Amount of the Loan) The margin for an Unsecured Loan is 15% |
The margin for Secured Loans up to Rs. 1.5Cr is 10% The margin for Secured Loans above 1.5Cr is 25% The margin for an Unsecured Loan is 10% |
| Rate of Interest |
Rate of Interest (ROI) for Listed Universities for Secured Loan up to 40 lakhs starts at 9.75% ROI for Secured Loan for Listed Universities for Secured Loans with 100% Collateral starts at 9.25% ROI for Non-listed Universities with 100% Collateral starts at 11.35% for Male Applicants and 10.85% for Females |
The Basic Rate of Interest starts at 11.75% |
| Concessions |
The bank offers a 1% Concession on the Interest Rate if Simple Interest is served during the Moratorium Period 0.50% Girl Child Concession is available for Secured Loans |
0.50% Concession for Girls 0.50% on 100% Collateral Security and amount above 20 lakhs and 0.50% on Universities Ranking less than 1000 0.50% for Medical, Engineering, and Management courses 1% Concession during the Moratorium Period Refunds Processing Fees After Disbursement |
| Level of Study |
The bank offers Secured Loans for all levels of courses like Masters, PG Diploma, Bachelors, UG Diploma/Certificate courses Bank offers unsecured loans up to 40 Lakhs for Master’s Degree at Listed Universities |
The bank offers Secured Loans for all levels of courses including Degrees, Pathways, Foundation, and Integrated Courses for Universities listed in Webometrics Ranking within 3000 |
| Loan Tenure |
15 years |
15 years |
| Sponsors |
Parents, Grandparents, Immediate Family |
Parents, Grandparents & Immediate Family |
| Simple Interest |
Serving Simple Interest is Mandatory for Unsecured Loans; for Secured Loans it is Optional |
Serving Simple Interest is Optional |
| Moratorium Period |
Course Duration + 12 Months |
Course Duration + 6 or 12 Months |
After comparing everything from Union Bank of India’s education loan interest rate and Bank of India’s interest rates and a lot more, let’s look at the factors one should consider while choosing the right bank.
Rate of Interest
Interest rate is one of the most important things to consider when planning to take a loan. It is a factor that keeps changing for banks every year. Comparing the interest offered gives students an idea of how much they can save on a particular loan.
Borrowing Limit
As we have seen the borrowing limit also changes depending on the type of loan. Banks offer different borrowing limits for education loans with collateral and education loans without collateral. Students can choose the bank they want depending on their financial needs.
Processing Fees
The processing fee is the amount charged by the banks for sanctioning the loan. The processing fees differ for different banks and thus are something that can be compared to get the best deal.
Moratorium Period
The moratorium period is the time when the borrower does not have to start making repayments for the loan. This period can vary from bank to bank, so it is important to compare this factor to get the optimum amount of time
Disbursement Norms
Disbursement norms are also a factor to consider as banks have different types of norms that may offer pre-visa or post-visa disbursement. Most banks usually offer 1 semester of tuition fees while the students require disbursement of 1 year of tuition fees and 1 year of living expenses for visa approval. So, students need to check the favorable disbursement norms as per their needs.
Eligibility Criteria
Before choosing a bank to take the loan it is important to check the eligibility criteria and determine if the student fits the bill. Co-borrowers also have separate eligibility criteria.
Let’s take a look at the common eligibility criteria for both banks:
| Bank of India |
| • ITR of 2 years is mandatory • No specific ranking of the university required for a secured loan • For unsecured loan universities to be listed under the top 160 bank list • Permanent residence proof is mandatory • No backlogs are acceptable for unsecured loans • For secured loans students need to pass in First Division in 10th, 12th, and bachelor’s student pass out • Borrowers are required to show a Facing balance of 15% margin at the time of loan sanctioning • No collateral required for loan up to Rs. 40 lakhs | • Loan can be processed based on Income Certificate • Secured loan offered only for Top 3000 Webometrics Ranking Universities • No specific academic criteria are checked if the university has a ranking under 3000 in webometrics ranking • Permanent residence proof is not mandatory. |
In conclusion, selecting the right bank for a study abroad loan is crucial for ensuring your financial well-being while pursuing education overseas. Both banks provide secured loans up to Rs. 1.5 Cr, but the nuances in interest rates, margins, and other conditions are vital to consider.
Élan Overseas Education Loans can help you navigate these complexities, offering personalized guidance to secure the best loan terms. For those comparing options, understanding the study abroad loan offered by these banks is essential to making an informed decision. So, connect with our team of Experts today to get started with your loan application.
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