Many students encounter the financial challenge of financing their education while pursuing academic excellence. Strong financial support is becoming more and more necessary as the cost of education rises. This is where education loan collateral becomes a vital resource, providing a lifeline to aspirational minds eager to expand their horizons via international education. A practical way to fill the financial gap is to obtain an education loan collateral. In this post, we examine the top five banks that stand out as trustworthy collaborators in enabling students to fulfill their academic aspirations via collateral-backed loans.
1. State Bank of India – For postgraduate studies in countries that are job-oriented for professional and technical graduates, such as Italy, Russia, the United States, the United Kingdom, Finland, Austria, Norway, Poland, Denmark, Germany, Ireland, Spain, New Zealand, Canada, Singapore, etc. SBI provides education loan. These courses include, but are not restricted to, diploma programmes at respectable colleges, MBA, MCA, and MS programmes. Tuition, book and equipment costs, exam fees, lab and library fees, caution deposits, travel expenses, and more are all covered by the SBI education loan for overseas study.
Key features of SBI education loan for abroad
- INR 7.5 Lakh to 1.50 cr in loans
- Competitive interest rate
- Online application process
- Loan sanction before visa
- Repayment tenure 15 years
- Tax benefit on interest rates under section 80(E)
- Processing fee is Rs 10,000 +GST
Six months following the completion of the course, SBI offers a moratorium period or repayment holiday. The loan applicant must provide the bank with the following documentation: the co-applicant’s details, the completed loan application form, the course costs, and the college admission letter.
2. Axis Bank – Students who want to study abroad for technical, professional, or career-oriented courses can apply for education loans. Depending on the requirements and qualifications of the individual, Axis Bank offers student loans with no maximum amount, starting at INR 50,000, and covering up to 100% of the total cost of study (including course fees, book costs, living and travel expenses). Obtaining an education loan from Axis Bank is a hassle-free process overall.
Key features of Axis Bank education loan
- Zero margin money for loans up to INR 4 lakh and 15% margin money on loans above 4 lakh for abroad studies.
- The education loan will be disbursed within two days after getting sanctioned.
- Once the loan is approved, one can also pay the prior installments that were made towards the course again.
- When applying for student loans, a parent or legal guardian must do so jointly and, if required, offer collateral security or a guarantee from a third party. Depending on the situation, Axis Bank might also consider a LIC policy covering 100% of the loan amount.
Eligibility criteria:
- Applicant must be an Indian citizen
- Applicant must have scored at least 50% marks in previous education
- Student should be enrolled in employable programs
- Applicant must have secured admission to a recognised institute
- The parent/guardian should have a stable source of income
Punjab National Bank – For Indian students who have excelled academically and wish to pursue an education overseas, PNB Udaan is a special education loan programme. Students who have been accepted into graduate or postgraduate programmes, such as diploma programmes, career-focused professional or technical courses, CIMA/CPA programmes, etc., are eligible for the loan. University fees, travel costs, exam fees, lab fees, library fees, book/equipment fees, and other related costs are all covered by the PNB loan. The loan applicant must be an Indian national and must have been accepted into a graduate programme at an accredited international college or university via entrance examination or merit-based selection. He/she ought to have passed the HSC as well.
Key features of Punjab National Bank education loan
- Education quantum – INR 30 Lakh
- Zero margin money for loans up to INR 4 lakh and 15% margin money on loans above 4 lakh for abroad studies.
- Repayment tenure – 15 years
- Zero prepayment charges
Eligibility criteria:
- Applicant must be an Indian citizen
- Applicants must have secured admission to a higher education program in recognised institutions outside India.
Bank of Baroda – A Baroda Scholar Loan is available for MBA, MCA, MS, and other accredited programmes that support the creation of jobs. Under the Baroda Scholar Loan programme, students can apply for an education loan before departing for professional or technical studies overseas. For the student to be eligible for the Baroda Scholar Education Loan in India, they must be accepted into the approved programme and institution. The loan cap is Rs 80 lakhs for designated institutions and Rs 60 lakhs for non-designated institutions.
Key features of Bank of Baroda education loan
- Processing fees: 1% (Maximum Rs. 10,000) for loans above Rs. 7.5 lakhs
- Zero margin money on education loans up to Rs. 4 lakhs
- Applicants will get a free debit card
- Zero documentation charges
- Collateral free loans for loans up to Rs 7.50 lakh
- Repayment tenure within 15 years
- Moratorium period of six months to one year after getting employment.
Eligibility criteria:
- Applicant must be an Indian citizen
- Applicants must have secured admission to a higher education program in recognised institutions outside India.
- Union Bank of India – Students with outstanding academic credentials can receive education from the Union Bank of India to pursue technical, advanced, or professional studies in India or overseas. It should be mentioned that the applicant’s parent(s) must apply as a co-applicant. If the student is married, the co-applicant(s) may be his or her spouse, parent(s), or in-laws. The applicant’s guardian or a close relative may serve as a co-applicant if the applicant’s parents are deceased. Furthermore, the co-applicant must be a citizen of India. Courses covered include doctoral programmes, postgraduate and graduate programmes, certified degree programmes offered by CIMA, London, CPA, USA, and other comparable institutions. Please be aware that diploma programmes taken abroad will not be covered.
Eligibility criteria:
- The applicant must be a citizen of India.
- The candidate must have passed the necessary examination and selection process in order to be accepted into a technical, higher education, or professional programme in India or overseas.
- There are no set minimum or maximum age requirements for this.
Key features of Union Bank of India education loan
- The lowest loan amount that can be approved under the education loan programme is not set in stone.
- Need-based finance won’t cover costs until account margin norms are taken into account.
- The following costs are covered: lodging costs, tuition fees, costs associated with exams, libraries, and labs; insurance premium for the student borrower; caution deposit; building fund; refundable deposit; purchase of books, equipment, and uniforms; costs associated with computers and laptops; travel; admission acceptance fee; and other expenses.
- After the course and the moratorium period, students have 15 years to repay the loan balance.
Education loan collateral provides students with a means of realizing their dreams of studying abroad. Even though the collateral requirement might seem like a big commitment, many prospective students find these loans to be an appealing option because of the benefits, which include lower interest rates and larger loan amounts.
