EDU Loans

Finding a reliable education loan lender can be a challenging process, given the attractive terms offered by numerous education loan lenders; both private and public. If you are confused about deciding on an education loan provider, this article will give you a much needed relief from the same.

Today’s article will educate you on certain aspects of the education loan process which should be taken into account before deciding on any education loan lenders in India. It is common knowledge that education loans in India are divided into two different categories based on the need of collateral security; secured education loans and unsecured education loans. One of the fundamental aspects which differentiates these two education loans is collateral security. The presence of collateral plays a significant role in helping education loan lenders determine their terms and conditions.

Coming to the topic at hand, there are several factors that are to be considered while finalising an education loan lender. Most students often commit the mistake of only looking at the education loan interest rate and then deciding on the education loan lender. The first factor that you must consider is which type of education loan to borrow.

As mentioned in the previous paragraph, there are two different types of education loans in India. The first step towards a successful education loan process is determining the type of loan you wish to fund your higher education with.

A government bank education loan or a collateral education loan involves the pledging of assets as collateral security. It is true that most government banks offer some of the best benefits. However, a lot of students fail to notice that borrowing a collateral education loan requires them to pledge some form of asset as collateral security. The value of this asset has to be greater than the education loan amount you need. If you do, then it is fair to consider a government bank education loan to fund your higher education.

However, a lot of students are left confused when terms like loan margin, fair market value, etc are thrown at them when they directly try to approach these government banks for an education loan.

Now, if you are someone who doesn’t have any assets to pledge as collateral, or are not able to manage a third-party’s assets for the same purpose, you may consider funding your studies with the help of an education loan without collateral. The education loan terms of NBFCs and private banks may make it seem like the whole process is going to burn a hole in your parents’ pocket. However, the fact that it does not involve any collateral security is what makes it attractive.

Now, similar to government banks, NBFCs and private banks also have a tendency to quote higher education loan interest rates.

Before beginning any education loan process, it is essential to know your eligibility for education loan. More often than not, students face rejection of their abroad education loan applications way later in the education loan process due to their ignorance about the criteria of eligibility for education loan. One of the major reasons for this is that most of these students are unaware of the exact criteria of eligibility for education loans set by most of the lenders.

Education Loan Options In India: A Brief Overview
Education loans in India are divided into secured loans and unsecured loans, based on the need of collateral security. Secured education loans are provided by all major government banks on the basis of tangible collateral security. This tangible collateral security may involve either immovable property, liquid security or assets belonging to a third party. The criteria of eligibility for education loans set by government banks are more flexible as compared to those of NBFCS. The criteria of education loan eligibility in India depends on the nature of the education loan being lent.

Unsecured education loans are basically education loans which do not involve any tangible collateral security. These loans are purely lent on the basis of a student’s merit, the ranking of their university and nature of the course chosen by them and their co-applicant’s financial records. Due to these reasons, the criteria of eligibility for education loans set by NBFCs are more stringent.

Both government banks, as well as NBFCs, consider certain factors of a candidate’s profile before setting the education loan eligibility criteria. These factors are mostly related to two different timelines, factors related to the past academic records and those related to the future, such as a student’s chances of getting employed post their course. Due to the different natures of these education loans, the education loan eligibility in India greatly depends on the kind of education loan lender chosen by you. Let us take a look at all of the education loan requirement for students and understand how they decide on the abroad education loan eligibility criteria.

Student Loan Eligibility: Factors Related to Past Records
When banks look into a student’s past records in order to decide their eligibility for education loan, it is all but obvious that these records are related to that student’s academics or their finances. The following academic details of a student’s profile are considered by banks as well as NBFCs before they are deemed to be eligible for an education loan. It is necessary to have a thorough knowledge of the following academic factors, especially when it comes to the abroad education loan process as a lot of students tend to be rejected only on the basis of these factors.

Factor 1:  Percentage of Marks Scored In Their Entire Course of Studies
The percentage of marks scored by applicants is one of the most important factors which contribute to the criteria for education loan eligibility set by most banks. Most government-run banks such as the Bank of Baroda, Canara Bank, PNB, etc. give due preference to students having more than 60% of marks in all of their qualifying exams in the past. As collateral is not involved in unsecured education loans, NBFCs have set a higher benchmark for academic scores for applicants to be able to meet the standards of eligibility for education loan.

Factor 2:  Backlogs in Academic Records
When students directly approach most government banks for an abroad education loan, many of the bank officials may state that students who have had more than three backlogs are not deemed to qualify for an education loan.

Factor 3:  Gap in Your Course Duration
Any gap in your academics or in the duration post that will have to be accounted for in order to prove your eligibility for education loan. The abroad education loan eligibility criteria set by most banks require students to explain any gap that may have occurred in the course of their studies or post that period, in a letter. For example, if you had graduated in 2017 and are planning to study abroad in 2020, you will be required to explain what you did in the three years from 2017 to 2019 in a letter. This is just one of the formalities which you may have to complete. Most bank officials do not bother to go into further details of such year gaps unless and until the time duration exceeds ten or fifteen years.

Factor 4: Work Experience
The abroad education loan eligibility criteria of prominent government banks  do not stress much on students having prior work experience as the chances of students getting secured education loans are mostly dependent on the collateral being pledged. However, the criteria of eligibility for education loan without collateral set by NBFCs and private banks encourage loan applicants with such profiles for abroad education loans.

Factor 5: Nature of The Course (STEM or Non-STEM)
Again, the criteria of eligibility for education loan of NBFCs specifically state that the nature of the course chosen by loan applicants does play an important role in determining their qualification for unsecured education loans. Most NBFCs and private banks are more keen to lend education loans without collateral to students who have enrolled in courses belonging to the STEM category. A few of them may still consider the applicant profile for education loan of students who have enrolled in courses belonging to the Non-STEM category under certain conditions only.

The abroad education loan criteria of government banks, however, allow students to borrow secured education loans for such courses provided that the ranking of their university falls within their requirements.

Factor 6: Degree Level (Undergraduate/Postgraduate)
The criteria of eligibility for education loans of most lenders are mostly decided on the assumption that most students would be needing an abroad education loan to pursue postgraduate level courses. However, with a rise in the number of students opting for undergraduate courses abroad, a lot of lenders have started providing abroad education loans. Again, since the main requirement of government banks for abroad education loans is based on the value of the collateral being pledged, many of them do provide secured education loans to candidates who need abroad education loans for their undergraduate courses abroad.

Again, the abroad education loan eligibility criteria of NBFCs are based on the needs of students who wish to pursue their postgraduate courses abroad. In fact, it is more difficult to fund undergraduate courses abroad with the help of  non collateral education loans  from NBFCs and private banks. Hence, if you are looking to fund your higher studies abroad with the help of abroad education loans, go for collateral-based education loans.

Education Loan Lender: Interest Rates
Every applicant considers the interest rates offered by education loan lenders before everything else. Sometimes, it is the only factor which is taken into account by students and their guardians alike while zeroing in on an education loan lender. But they aren’t wrong altogether. You should always consider the interest rates offered by education loan providers when you begin your education loan journey. This is one of the basic parameters of a typical education loan scheme. Most government education loan lenders offer lower interest rates that fall in the range of 8.5% to 10%. The interest rates of education loan without collateral are in the range of 11.5% to 14.9%. 

Education Loan Processing Fees
Although this aspect of the education loan process is seldom the talking point of discussions, processing fees is a very important part of the education loan process. Education loan lender decide the education loan processing fees depending on the services opted by loan applicants. Government education loan lender have a fixed processing fee while those of NBFCs and private banks differ. NBFCs and private education loan lender charge a certain percentage of the total education loan amount as processing fees. This percentage falls in the range of 0.9% to 2% of the total loan amount.

Education Loan Repayment Policies
Another factor which is highly underestimated by loan applicants is the policies of education loan lender regarding the repayment of abroad education loans. Repayment is one of the primary things that should be considered by every education loan applicant before deciding to borrow a loan to fund their studies. The education loan repayment policies of government banks are more feasible to students who do not have financially stable co-applicants. Government banks grant a moratorium on education loan repayment. This moratorium period lasts till candidates finish their courses and get employed. This is one of the highlights of government bank education loans. Interest charged during the moratorium period can be paid along with the EMI, later.

The repayment policies of NBFCs and private education loan lenders require students to begin their education loan interest payment a month from the date of the first disbursement of education loan. So if you are opting for an education loan without collateral, do keep this point in mind.

Education Loans Acceptability In Embassies
A lot of countries do not accept private education loan lenders to be trustworthy sources of funding. Hence, if you are planning to borrow from a private education loan provider, do check whether an education loan from your respective lender is considered to be acceptable by that country’s embassy. Proceed with the application process only after confirming the same.

All of the above mentioned factors are significant in the decision making process of choosing an education loan lender. So do keep these in mind when you decide to borrow an education loan to study abroad.

Many students who wish to borrow an education loan are mostly concerned about their education loan repayment. Having a thorough knowledge about the various education loan benefits helps in the longer run, especially during your education loan repayment period. Some of these education loan benefits are only applicable to students who belong to certain sections of society. This article will give you an account of all the education loan benefits that candidates get to avail during their education loan repayment.

An education loan to fund your studies abroad is a major financial liability. However, there is always a solution to resolve any such liability and the following education loan benefits will make you rethink your decision to fund your higher education by yourself.

Why Borrow an Education Loan?
When it comes to pursuing your higher studies abroad, it is common knowledge that the entire process is not cheap. Education loans are one of the most preferred sources of funding all across India. A major percentage of students often resort to education loans to fund their higher studies abroad, regardless of their financial capacity. So what draws them to education loans? In order to know the reason behind students’ inclination towards education loans, let us take a brief look at the other sources of funding:

Self-funding: Students who come from financially well-off households have the option of funding their entire course abroad by themselves. However, before you even think of exploring this option, you need to understand one thing. While self-funding is one of the best ways to fund your higher studies abroad, it does not ensure a smooth flow of money in the duration of your course abroad. You will be required to cater for any and all financial emergencies during your course period, while also catering to ensure a constant presence of money for all your personal expenses back home. 

Scholarships: Students whose academic records reflect exemplary skills in their curricular and extracurricular activities are awarded fully funded scholarships to study abroad. However, the catch here is that such scholarships are awarded only to a handful of such students. Another challenge here is finding the right scholarship which is applicable to your field of study. 

None of the challenges which are applicable to the above two funding sources is true in the case of an abroad education loan.

An education loan is one of the most widely accepted funding proofs by the immigration authorities of the USA, Canada, Australia, New Zealand, Ireland which are some of the preferred destinations for a majority of Indian students to study abroad.

Now let us take a look at the various education loan benefits which is applicable to students who choose to fund their higher education abroad with the help of one.

Education Loan Benefits: Income Tax Exemption under Section 80 E
How does an education loan income tax benefit sound to you? A major percentage of candidates who borrow an abroad education loan to fund their studies are well aware of this provision. However, very few opt to avail it. This is because they are not entirely aware of how this benefit of an education loan helps students save on a significant amount of money during their education loan repayment period.

Section 80 E of Income Tax Act, 1961, states that loan applicants or their co-applicants can avail a certain percentage of exemption on their yearly income tax payment by declaring their education loan repayment details. The percentage of exemption on the yearly income tax payment depends on the salary bracket to which the respective co-applicant or loan applicant belongs. The eligible salary brackets for an education loan income tax benefit is decided by the Income Tax department.

This education loan income tax benefit can be availed by eligible candidates for 8 consecutive years in their education loan repayment duration. If you have taken a secured education loan to fund your higher studies abroad, then you should consider claiming your education loan income tax benefit post the moratorium period granted by your respective government bank.

In the case of unsecured education loans, candidates or their co-applicants may start claiming from the beginning of the course period. Education loans borrowed from both, government banks, as well as NBFCs are eligible for this exemption.

Only one person among the two, i.e, either the loan applicant or their co-applicant can claim this education loan benefit. Individuals working in India only are eligible to claim this education loan benefit. I

Education Loan Benefits: Moratorium Period
This is one of the main highlights of borrowing a secured education loan from government banks.

According to the RBI regulations, all education loan applicants are to be granted a loan holiday by the lending institutions before their education loan repayment process begins. However, since NBFCs have their own policies regarding education loan recovery and also since are directly not controlled by the RBI, this particular benefit of an education loan is not applicable. This loan holiday is called a moratorium period in education loan terms

The reason why this benefit of education loan is considered to be a bonus factor is that in the duration of this moratorium period, candidates are not required to make any repayment. Interest will be charged for this entire duration on the basis of simple interest by banks. Post the completion of this moratorium period, students may begin their interest and EMI payments.

Most of the government banks grant the entire course duration, plus six months to a year’s time as the moratorium period for secured education loans. Unfortunately, NBFCs do not have a similar provision.

What is a Disbursed Loan Amount? Are Sanctioned Amount and Disbursed Amount the Same?
There is another widespread notion that it is mandatory for students to use the entire education loan amount which was sanctioned. An education loan sanction and education loan disbursement are two different activities in the abroad education loan process. 

Government banks, private banks, as well as NBFCs, charge interest only on the education loan which is disbursed by candidates. Hence, even though a certain amount is sanctioned by your lender at the beginning, they are supposed to charge interest only for the amount which is being actually disbursed to applicants.

Sanctioned loan amount refers to the loan amount allocated to a student. Disbursed loan amount refers to the actual money withdrawn by loan applicants for the purpose of funding their daily expenses and interest is applicable only on the latter.

An education loan is indeed a major financial liability to take over. However, if you approach the entire process in a systematic and knowledgeable manner,  then you may not face as many obstacles as you expect to face along the journey. It is very crucial to understand that different lenders may choose to handle the education loan applications of individual applicants on a case by case basis. Hence, the education loan benefits that one applicant gets to avail may not be applicable to you as your case may differ from that of them. The main key to having a successful education loan tenure and to be able to repay your education loan in time is to remain one step ahead by having a thorough knowledge of the various ways in which they work.

Interest rate plays a very important role in any loan process. The overseas education loan process is no exception in this case. Most loan applicants make the final decision of borrowing an education loan by taking into account the abroad education loan interest rate of the respective lender. Oftentimes, the abroad education loan interest rate could be the only factor on the basis of which students decide on a lender. However, one thing which everyone needs to remember is that the abroad education loan interest rates of various lenders depend on a lot of factors. This article aims to shed light on these factors, as well as list out the latest values of the education loan interest rates charged by the various types of lenders in India.

A typical abroad education loan interest rate in India greatly depends on the type of lender. Education loan lenders in India can be bifurcated into three distinct categories, based on the type of abroad education loan provided by them. Government banks, NBFCs and private banks and finally, foreign lenders.

How Are The Values Of An Abroad Education Loan Interest Rate Decided?
The abroad education loan interest rate in India is determined by lenders on the basis of something called the MCLR, or Marginal Cost of Funds-Based Lending Rate. This figure is often considered to be the benchmark on the basis of which most Indian lenders of education loans calculate the abroad education loan interest rates. The MCLR is calculated by taking into account various factors such as the tenure premium, the marginal cost of funds, the operating cost, etc.

Government Bank Education Loan Interest Rate
Although the MCLR is the basis of all the abroad education loan interest rates fixed by lenders in India, most government bank education loan interest rates are calculated as MCLR plus spread. This spread refers to a premium amount levied by banks, in addition to the basic MCLR value. The abroad education loan interest rate of government banks vary between 9% and 10%. Since they grant education loans on the basis of collateral security, the final education loan amount sanctioned by government banks could go up to INR 1.5 Cr.

Abroad Education Loan Interest Rate of Foreign Lenders
Foreign lenders follow a different set of education loan policies. The same applies to their foreign education loan interest rates. The foreign education loan interest rates of foreign lenders are calculated on the basis of something called LIBOR or London Inter Bank Offered Rate. LIBOR values vary almost every two months and this variation affects the final abroad education loan interest rate of foreign lenders. The difference in currency values also play a significant role in determining their foreign education loan interest rate.

Foreign lenders levy education loan interest rates that vary between 8.5% to 11%. However, since the abroad education loan amount is in USD, this 8.5% is interpreted as 13.5% when you convert it in terms of the INR.

When students directly approach lenders in India for an abroad education loan, various factors of the education loan schemes such as the abroad education loan interest rates, the education loan repayment terms, etc are often lost in translation.

A lot of students who have borrowed an education loan to fund their undergraduate studies with the help of an education loan and wish to further pursue their postgraduate studies abroad with the help of another one are often faced with one major question: What is the abroad student loan process to fund their postgraduate studies with the help of a second education loan? This article will elaborate on the various terms and conditions that students need to fulfil in order to begin their abroad student loan process for a second education loan.

By now, you must be familiar with the two basic types of education loans which are mainly lent in the abroad student loan process. For those of you who are yet to understand the abroad student loan process broadly, here is a short description of the two types of education loan in India.

Abroad Student Loan Process: Types of Education Loan in India
In the abroad student loan process, education loans are categorised into two different types based on the requirement of collateral. In order to borrow an education loan in India, it is essential to have sufficient information on both types of abroad education loans.

Secured Education Loan: Secured education loans are lent on the basis of collateral. The typical abroad student loan process for secured education loans requires students to pledge any of the three types of assets as collateral against their education loan. These loans are lent by all prominent government banks in India. One of the biggest benefits of secured education loans borrowed from government banks is the moratorium period which is a loan holiday granted to all candidates before the repayment period begins. This moratorium period buys enough time for students to find employment and begin their education loan repayment.

Unsecured Education Loan: Unsecured education loan is basically an education loan without collateral. These loans do not require any form of collateral. They are mainly lent by private financial companies called NBFCs (Non-Banking Finance Companies) and a few other private banks.

Government banks lend unsecured education loans of up to Rs.7.5 Lakhs too. Unlike government banks, NBFCs and private banks do not offer the benefits of a moratorium period to the loan applicants.

Borrowing a Second Education Loan: Secured Education Loans
Secured education loans are preferred by a lot of students for a second education loan. This is because government banks offer some of the lowest interest rates on education loans, in addition to the various benefits.

One of the only major factors that cause a lot of such students to hesitate from borrowing secured education loans is the requirement of collateral.

Let us take a look at two different scenarios in which candidates are likely to borrow a second education loan for their higher studies.

Borrowing a Second Education Loan From the Same Bank as the First:
When candidates apply for an education loan from the same government bank as the one from whom they had borrowed their previous education loan, they need to keep in mind a few things. While borrowing a secured education loan for the second time, there are two situations that may arise.

Borrowing an education loan when the repayment of the previous education loan has not yet begun:
For example, you have just finished your undergraduate course for which you had taken an education loan and wish to take another one for your postgraduate course which is due to begin immediately, within a month or so. In this scenario, it is recommended that you don’t begin the repayment process of the first education loan.

When you apply for a second loan immediately post your undergraduate course, six months of your moratorium period from the first loan is still applicable. By the time your second education loan from the same bank is sanctioned, the moratorium period of the second one becomes applicable and hence, you get up to 5 years of loan holiday in this way, depending on the total duration of both the courses.

Borrowing an education loan when the repayment of the previous education loan has already started:
In this scenario, if your loan repayment has already begun then you will be required to make the EMI payments regularly, according to the schedule.

Value of the collateral being pledged: This is one of the most important factors to consider while applying for a second education loan with government banks. If your collateral was already pledged for the previous education loan, then you need to ensure that its total value is sufficient to cover the second education loan. The abroad student loan process to get another education loan on the same collateral can only be possible if its value is significantly high. However, here is the good news, government banks allow candidates to pledge a third-party’s (anyone other than the family members) assets as collateral for the second education loan.

For example, if the collateral pledged for your previous education loan was valued at Rs.1 Cr. and you took a loan amount of Rs.50 Lakhs, then during the abroad student loan process of borrowing a second education loan on the same exact collateral, the bank will estimate its cost to be at Rs.50 Lakhs and the final amount of your second loan and your loan margin will be estimated by the bank accordingly.

Borrowing the Second Education Loan From a Different Bank/Lender:
It is also possible for candidates to opt for a second education loan from a different lender. In order to borrow it from a different lender, candidates need to ensure that they have completely repaid their previous education loan and once they have received a NOC (No Objection Certificate) from their previous lender, the abroad student loan process for the second education loan can be started.

Borrowing a Second Education Loan: Unsecured Education Loan
An education loan without collateral is an excellent choice for candidates who do not possess assets whose value could cover a second education loan from government banks. NBFCs and private banks often consider the financial records of co-applicants before processing an education loan for abroad studies application for the second time. Hence, having a co-applicant with a sound financial record and the right documents is a mandatory requirement for unsecured education loans for abroad studies.

Another important point to note while applying for a second education loan from NBFCs is that candidates need to ensure that their previous education loan has been repaid in full and that there are no more EMIs pending.

If you plan on getting another unsecured education loan for abroad studies, you need to ensure that your co-applicant’s financial capacity will be able to cover both the education loans.

A lot of students who had previously taken an education loan often hesitate to borrow another education loan for abroad studies, due to a lot of constraints. One of the constraints is the widespread misconception that it is not possible to borrow a second education loan.

A major percentage of students who do not have any collateral opt for an abroad education loan without security. However, with the rise in the number of lenders offering an abroad education loan without security, the entire process of getting an abroad education loan without security becomes all the more confusing. This article will give you a detailed comparison of the unsecured education loan details of both categories of lenders. 

In India, there are two major categories of lenders who provide unsecured education loans to students – private banks and NBFCs. The policies set by both these organisations for study abroad education loan without security are based on different principles. You can learn all about the differences in the following paragraphs.

Procedure-wise, unsecured education loans provided by NBFCs are easy. Securing an abroad education loan without security from NBFCs is an easier process when you compare them with the education loan procedure of nationalised banks and PSUs.

Some of the factors that make obtaining education loans from NBFCs easier are:

1. Faster & easy disbursement: Since an abroad education loan without security does not require students to pledge collateral security of any kind while applying, the disbursement process of a non-collateral education loan from NBFCs becomes much faster. This means that the additional procedures like obtaining the legal opinion from a lawyer and getting the property evaluated by a competent authority are skipped. To sum it up, the disbursement of a non-collateral education loan from NBFCs does not exceed more than a weeks’
2. Less paperwork: In case of an abroad education loan without security, where there is no security involved, the amount of paperwork which is to be done by the candidates and the NBFCs automatically comes down. Hence this speeds up the process as well.

No Loan Margin: An abroad education loan without security from NBFCs generally funds 100% of a candidate’s higher studies. This means that there is no loan margin set for education loan applicants by NBFCs.

After going through the previous paragraphs, you may have come to the realisation that the terms and conditions offered by NBFCs, as well as private banks may seem similar. However, the benefits of borrowing an unsecured education loan from private banks are always higher as compared to NBFCs when it comes to the following points:

1. Education Loan Interest Rate: The Interest rates offered by NBFCs are slightly higher as compared to those offered by private banks. Also, the education loan interest rates of NBFCs for unsecured education loans are variable, depending on the quality of a student’s profile. Private banks, on the other hand, have fixed interest rates.
2. Student visa process: The embassy of a country like Australia is particular about the proof of funds submitted by students who have applied for a student visa. If you show your proof of funds to be unsecured education loans from NBFCs, you might likely face issues in getting your student visa approved on time. On the other hand, unsecured education loans from private banks are accepted by most NBFCs as proof of funds, as embassies consider private banks to be reliable sources of funds.
3. Variation in Terms and Conditions: The education terms of NBFCs can be varied depending on the quality of a student’s profile. However, since these organisations are not completely bound by RBI regulations, these terms can be changed without any prior intimation. In 2018, all the major NBFCs faced a major financial crisis and the interest rates of all unsecured education loans were hiked without any prior intimation. This is one of the major risks of borrowing an education loan from NBFCs. Private banks, on the other hand, are required to adhere to RBI regulations and hence, their terms and conditions remain constant.

Possessing a thorough knowledge about the various education loan terms and conditions is a crucial part of the education loan process. The decision to fund your higher education abroad with the help of an abroad education loan without security is a risk in itself due to the inherent nature of unsecured education loans. It is very important to make an informed decision when you fund your higher studies with education loans.

Canara Bank is one amongst the many government banks in India providing secured education loans to individuals having different funding requirements. Get to know all about the various Canara Bank education loan details here. You will get the complete information about the various Canara bank education loan schemes, interest rates, repayment terms, etc.

Canara Bank Education Loan Details
The Canara Bank has introduced education loan schemes to suit the financial needs of individuals coming from all backgrounds. Out of all the Canara bank student loan schemes, the IBA model loan product for higher education in India and abroad is one of their most sought-after products. The below table will give you complete information regarding this Canara bank education loan product, followed by the rest of the products.

Canara Bank Education Loan: IBA Model Loan Product For Higher Studies in India and Abroad

Canara Bank Education Loan Interest Rate
The Canara Bank education loan interest rate keeps varying depending on the MCLR. The MCLR (Marginal Cost of Funds Based Lending Rate) is a benchmark lending rate used by banks all over India to decide their education loan interest rate. The ongoing MCLR declared for Canara Bank education loan interest rate is 8.40%. The interest rates of all the Canara Bank education loan schemes are decided based on this MCLR.

For Canara bank abroad education loan, the ongoing ROI varies, depending on the Canara bank education loan schemes. The Canara bank education loan interest rates for the different education loan schemes are listed in the above tables. You may refer to them for information regarding the same.The Canara Bank education loan interest rates for female candidates come with a 0.5% waiver for all the education loan schemes.

Now get to know more about how much EMI you would need to pay towards your Canara Bank education loan by using the Canara bank education loan EMI calculator available on the main website of Canara Bank.

Canara Bank Education Loan Margin
It is common knowledge that not all government banks help fund 100 percent of the total expenses of a candidate’s higher studies. Every bank sets a loan margin for all collateral-based abroad education loan schemes. Loan margin essentially refers to the percentage of contribution made by loan applicants towards the total expenses of their higher studies course abroad.

Canara Bank has set the loan margin at 15% for abroad education loans. This means that candidates will be required to contribute 15% of their total expenses and the remaining 85% will be funded by the Canara bank student loan scheme for abroad studies.

Canara Bank Education Loan Documents   
Given below is a list of Canara Bank education loan documents to be submitted by students who have applied for an education loan in Canara Bank. 

General documents to be submitted by students/loan applicants:

1. Duly filled Canara bank education loan application form.
2. 2 Passport size photographs.
3. Passport: compulsory for education loan for abroad studies.
4. Identity Proof: Pan Card, voter ID card.
5. Address proof: Aadhar card, Driving licence, a recent copy of telephone bill, electricity bill, water bill, piped gas bill, etc.
6. Academic mark sheets of 10th, 12th, Undergraduate Degree (if applicable)
7. Eligibility test scorecard: SAT/GRE/GMAT/TOEFL/IELTS scorecards.
8. University ranking printout. To get the correct university ranking, contact our team.
9. Admit letter from the university.

Documents to be submitted by co-applicants/guarantors:

1. Identity Proof like PAN card, Passport, voter ID card.
2. Address proof like an Aadhar card, driver’s licence, latest copy of gas bill/telephone bill/electricity bill/water bill/piped gas bill.
3. 2 passport size photographs.
4. Documents related to any ongoing loans from other banks/lenders.
5. Loan account statement for one year.

Finance-related documents to be submitted by co-applicants/guarantors:

If the co-applicant is a salaried professional: 

1. Salary slip/salary certificate.
2. IT Returns documents of 2 years.
3. The co-applicants bank salary account statement for the past 6 months.

If the co-applicant/guarantor is self-employed/owns a business:

1. Business address proof (if applicable)
2. ITR documents for 2 years.
3. TDS Certificate (Form 16A) if applicable.
4. Certificate of qualification (for co-applicants who are doctors, CA and other similar professionals)
5. Bank account statement for the last 6 months.
6. All the above-mentioned documents are to be self-attested by the co-applicant.

Apply online to get the latest list and guidance.

Canara Bank Education Loan: Accepted List of Assets For Collateral
Canara Bank offers collateral based education loan under the IBA education loan for higher studies in India and Abroad scheme. Below given is a list of assets generally accepted by Canara Bank as collateral against an abroad education loan. Generally the following categories of assets are accepted as collateral security against an abroad education loan in Canara Bank.

Immovable property: Canara Bank accepts immovable property residential flat, independent house  non-agricultural land/ empty plots with defined boundaries as collateral security against an abroad education loan.

Liquid security: Liquid assets such as FDs (preferably opened with Canara Bank), Govt Bonds, a life insurance policy with a fixed maturity date from government-approved national insurance providers, etc. are also accepted as tangible collateral security against a Canara Bank abroad education loan.

Third-party collateral: The Canara Bank also accepts assets belonging to a third party (someone apart from the co-applicant) as collateral security against education loans. Like collateral belonging to uncle/ aunt/ other relatives/ family friends are acceptable as well.

Collateral (immovable property) related documents checklist:

1. Property title deed and registered sale agreement.
2. Original registration receipt of the sale agreement.
3. Allotment letter by the respective municipal corporation or any competent government authorised bodies such as HUDA, JDA, DDA, GIDC, MIDC, etc.
4. Encumbrance Certificate (E.C) of the past 30 years. This document is commonly known as a ‘link document’.
5. A copy of the municipality approved building plan/plot layout.
6. Latest property tax bill or latest electricity bill bearing the same address.

The above list is a generic list. Immovable properties belonging to different regions require various different set of documents. To know the entire list of documents for an education loan in Canara Bank, do apply online and get in touch with the education loan team.

Canara Bank Education Loan Eligibility Criteria
The Canara Bank has not stated any particular eligibility criteria for loan applicants. The only eligibility criterion stated by Canara Bank for abroad education loan applicants is that they should be Indian citizens.

Canara Bank Education Loan Subsidy & Tax Benefits
Students who belong to certain categories are eligible for a Canara Bank education loan subsidy under schemes introduced by the government of India for the benefit of students who have borrowed an education loan to aid their higher education. The Canara Bank education loan interest subsidy and tax benefits can be availed by students belonging to select communities and income groups only. The following Canara Bank education loan subsidy and tax benefits are applicable to students borrowing an education loan.

• Central Sector Interest Subsidy Scheme
• The Padho Pardesh education loan interest Subsidy Scheme
• Dr Ambedkar Central Interest Subsidy Scheme

Education loan income tax exemption under Section 80 E
Students who have borrowed an education loan to fund their higher studies abroad are exempted from paying a certain percentage of their interest amount as income tax under the Section 80 E of the Income Tax Act of 1961.

Eligibility: Candidates who have borrowed education loans from government banks. This subsidy can only be availed either by the loan applicant or the co-applicant depending on who is paying the interest component. In either case, only one of the two can claim this subsidy.

Canara Bank Education Loan Repayment
The Canara bank education loan repayment schedule is more or less similar for all the Canara bank education loan schemes, except for the Vidya Sahay education loan scheme. Candidates who borrow an education loan under any of the Canara Bank Education loan schemes are granted a moratorium period before the repayment of their loan commences.

ICICI Bank has come up to be one of the most prominent names in the education loan industry, what with their competitive interest rates and education loan repayment policies for unsecured education loans. The bank has categorised universities all over the world into different lists, based on their global ranking. The global ranking of the courses provided by these universities is also taken into consideration for an ICICI Bank education loan without collateral. Some of the basic education loan details of the ICIC Bank education loan without collateral are as follows:

*The loan margin is only applicable to unsecured education loan amounts of above INR 20 Lakhs in ICICI Bank.

** Purchasing loan insurance is a compulsory requirement for all students who plan on borrowing unsecured education loans from ICICI Bank for their higher studies abroad. 

Axis bank is another private bank which offers unsecured education loans at competitive interest rates to students who wish to study in various universities abroad. The Axis Bank also maintains two different university lists called Prime A and Prime B which is similar to the system adopted by ICICI Bank for abroad education loans. The terms and conditions of unsecured education loans of Axis Bank are, as depicted in the below table. 

The unsecured education loan terms and conditions applicable to loan amounts exceeding INR 20 Lakhs is different in Axis bank. They have been mentioned in the below table.

Important points to note about Axis Bank Unsecured Education Loans

1. Loan Margin: Unsecured education loans from Axis bank covers about 85% of the total expenses. The margin of 15% is fixed and it rarely varies.
2. Axis Bank Education Loan Processing Fees: The Processing fees charged by Axis bank for unsecured education loans that exceed INR 20 Lakhs is calculated as 0.75% of amount above 20 lacs + GST (non-refundable)
3. Purchasing loan insurance is compulsory for all unsecured education loan schemes. The loan insurance fee will be adjusted against the candidate’s total loan amount.

Education Loan Details of Abroad Education Loan Without Security Borrowed From NBFCs

NBFCs are the primary choice of many students who wish to borrow a non-collateral education loan to study in prestigious universities abroad. The terms on the basis of which NBFCs grant unsecured education loans to students is more or less similar, regardless of their brand. Some of the common abroad education loan terms which are applicable to abroad education loan without security are mentioned in the table below. The maximum education loan amount limits offered by NBFCs for different countries are different.

Candidates may secure the desired education loan amount only if their academic records reflect excellent performance. Terms which are important to the entire education loan process, such as the interest rates, processing fees, etc. may vary depending on the quality of a student’s academic profile and their co-applicant’s financial profile.

The Bank of Baroda education loan interest rate is perhaps one of the lowest rates offered for any government bank education loan, especially in the case of abroad education loans. The Bank of Baroda education loan interest rate is revised periodically, on the basis of certain factors, like the Bank of Baroda education loan base rate. These factors affect the values of the Bank of Baroda education loan interest rate in a lot of ways. In this article, you will learn all about the Bank of Baroda education loan interest rate applicable to the different Bank of Baroda education loan schemes. A brief explanation of the Bank of Baroda education loan details of each of these schemes is also provided further ahead.

The Bank of Baroda Education Loan Interest Rate 2020 For The Various Bank of Baroda Education Loan Schemes
The Bank of Baroda has launched various different Bank of Baroda education loan schemes for the benefit of students who wish to borrow an education loan to cater to the various financial requirements of studying in various countries abroad. Here is a list of the Bank of Baroda Education loans and their respective interest rates.

Before we begin listing the Bank of Baroda education loan interest rates below, all readers need to keep in mind that these values are revised from time to time, according to the changes made in the RBI repo rate. The values mentioned in this article are calculated with respect to the BOB education loan interest rate 2019.

The Baroda Scholar Education Loan Scheme.

This Bank of Baroda education loan scheme is specifically designed for students who wish to borrow an abroad education loan. The Bank of Baroda interest rates for the  Bank of Baroda university list of eligible institutions is as depicted in the table below.

Female candidates are eligible for a 0.5% waiver on their Bank of Baroda education loan interest rates for loans taken under this education loan scheme. 

The Baroda Executive Development Program Education Loan in Premier Institutions (For higher studies abroad).

This Bank of Baroda education loan scheme is specifically designed for experienced professionals who wish to pursue their higher education in Management streams in prestigious universities abroad. Female candidates are not granted any special concession on their Bank of Baroda education loan interest rate for loans borrowed under this particular scheme.

The Credila education loan interest rate is a common concern for students who wish to borrow an HDFC education loan for abroad. The HDFC education loan for abroad is granted by Credila, a subsidiary of the bank which specialises in granting only unsecured education loans for abroad studies to eligible candidates. Since the Credila education loan interest rate is revised from time to time, it is very important for all the education loan applicants to have a clear understanding of how the HDFC education loan interest rate is calculated and also the repayment policies for the same.

As is the case with most lenders who lend unsecured education loans for abroad education, the Credila education loan interest rate varies for different loan applicants, depending on various factors of their profile. This article will give you an elaborate explanation about how the HDFC credila interest rate is calculated, the various factors which are responsible for the final Credila education loan interest rate values, etc.

HDFC Credila Education Loan Eligibility Criteria for Students:

1. The student should be an Indian citizen, residing within India.
2. The student should have already secured admission into a university/college for the course specified in their Credila education loan application.
3. The co-borrower or the co-applicant for an HDFC education loan must be an Indian resident.
4. Co-applicants must have an account in any Indian bank with cheque-writing facilities.

HDFC Credila Education Loan Eligibility Criteria for Co-applicants / co-borrowers:

1. In order for candidates to enjoy the complete benefits of the Credila education loan interest rate, it is mandatory to name individuals having a stable financial back-up as co-applicants.
2. Candidates have the liberty to name their Father / Mother / Brother / Sister (married) /Spouse, as co-applicants where such Co‐applicant’s income would be considered in determining the loan eligibility per HDFC Credila’s credit and underwriting norms
3. The co-applicants are equally liable to complete the education loan repayment on time as the students.
4. All co-applicants are supposed to submit the relevant education loan documents at the time of applying for an HDFC education loan. 

Whether or not Credila Actually Charges Simple Interest During the Moratorium Period.

This is the question which every candidate must ponder on before proceeding ahead with their education loan application process with HDFC Credila. It is common knowledge that all NBFCs charge interest during the course period for all candidates who have borrowed an abroad education loan.

Many of the education loan repayment terms of a Credila education loan without collateral is similar to those of most NBFCs. Like all major NBFCs, HDFC Credila also claims to charge simple interest during your moratorium period. When you carefully go through their FAQs on the education loan repayment rules, you will find certain statements that will point out the fact that this is not the case.

According to the HDFC Credila education loan repayment terms and conditions, all applicants are promised that the Credila education loan interest rate charged during the moratorium period is calculated on the basis of the simple interest concept. 

This statement indirectly states that should candidates default on their education loan interest payment at any point during their moratorium period, the balance amount will be accumulated and compounded at the end of that particular year. Food for thought, right? 

It is extremely important to go through the loan repayment terms and the Credila education loan interest rate conditions before deciding to borrow an HDFC Credila non-collateral education loan to support your higher studies abroad.

The HDFC Credila Education loan interest rate 2019 or the HDFC Credila CBLR is 12.55%. This is subject to change from time to time.

HDFC Credila Interest Rate: The Partial Interest Payment Issue

It is common knowledge that most NBFCs, including HDFC Credila, allow students to make their interest payments partially during their moratorium period. Have you ever wondered whether this is actually beneficial to you as a loan applicant? 

The option of paying partial interest during the moratorium period may sound like a boon to most students who are still pursuing their higher education and are in the midst of their moratorium period. But you need to understand that the remaining interest amount will be again compounded and added as accumulated interest along with your principal amount at the end of that particular year. 

It is similar to your credit card bill payment. You will be able to use your credit card after having paid the minimum dues for the month. However, you fail to understand that interest is charged on the unpaid amount at the end of each month and finally, your debts increase manifold.

The partial interest payment of an HDFC Credila non-collateral loan is somewhat similar to this system. This is the second important point to note.

Credila Education Loan Interest Rate: Monthly Interest Payment

Did you know that HDFC Credila charges monthly interest on their non-collateral education loans? And this information is provided on their website, again within the FAQs section. This tells you that they may not follow a uniform method during your loan repayment tenure.