Education Loan to Study in the USA for Indian Students | GyanDhan
Updated on: 11 May 2021
The USA is one of the most sought-after destinations for Indian students seeking education opportunities abroad. A very few countries in the world offer as many benefits of higher education as America. A majority of top colleges in the popular world rankings are from the USA. And the career opportunities post the study in the US are simply unmatched.
In a nutshell, America seems to be promising. But this potpourri of benefits comes with a price tag- a ridiculously big one! To furnish such exponentially high costs, education loans are the best choice! In the first sight, education loan to study in the US for Indian students might seem like a jigsaw puzzle, but if you do your homework or take the help of expert loan counselors, you can get the best loan product for you!
In this blog, we will discuss in detail the education loan option for Indian students to study in the USA, different lenders, and the application process.
Let's dive in...
Is education loan the right option?
Readily available funds are always beneficial and education loan gives you that. Even if you have savings to fund your study in the US, you must consider taking an education loan, for if you invest that money smartly, you can reap more interest than what you will be paying for your education loan.
Here are some of the top benefits of taking an education loan to study in the USA:
Personal savings remain untouched
Tax savings on study loans
Customized loan products
Repayment after graduation
Self-dependence
To know in detail about the benefits of abroad education loans, you can read Top Benefits of an Education Loan
What to check while selecting the education loan?
What are types of education loans available in India for study in the USA?
Broadly, there education loan options in India to study in the USA fall under two brackets:
1- Secured Education Loans: These are the education loans with collateral. As the name suggests, you will have to pledge an asset to lender as a security in order to get an education loan. This collateral can be of two types:
Tangible assets such as flats, land (non-agricultural), shops, etc.
Intangible assets such as fixed deposits, life insurance, government bonds, etc.
To know in-depth about abroad education loans with collateral, read All You Need To Know About Education Loan with Collateral
2- Unsecured Education Loans: These are the education loans without collateral. As the name suggests, you do not need to pledge any security to the lender in order to avail of the education loan. However, there should be co-applicant and his/her income becomes a major determinant of the loan sanction. Also, only the private lenders in India and a few international players offer an unsecured education loan for amount more than INR 7.5 Lakhs.
To read in detail, visit Education Loan without Collateral for Abroad Studies
What are the types of lenders offering US education loans to Indian students?
There are mainly 4 types of lenders that provide education loan to study in the USA for Indian students:
What are the expenses covered in education loans for the USA?
Various loan schemes are available in India which cover almost all types of expenses other than the tuition fee.
Some of the expenses covered under the study loans are:
Fee payable to the college
Accommodation fee
Examination, laboratory, library, fee
Books, instruments, etc.
Caution deposit, refundable deposit, building fund, etc.
Travel expenses
Insurance premium (if applicable)
Laptop (if required)
Other expenses like study tours, thesis, etc.
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Which are the top government bank schemes in India offering education loans to study in the USA?
Some of the top government bank schemes in India offering education loans to study in the USA are:
SBI Global Ed-Vantage: State Bank of India has Global Ed-Vantage scheme to Indian students for offering overseas education loan USA. In this scheme, you can get a loan amount between INR 20 lakhs and INR 1.5 crore. The maximum loan tenure is of 15 years and the repayment period starts after 6 months of the course completion. To get this loan, you are required to provide collateral as security. SBI mainly considers this collateral as the key source of security. Co-applicant’s profile is not very important. State Bank of India has a fixed interest rate for all students to study in all courses in the USA. You can also get a rebate of 0.5% on the interest rate if you take SBI RiNn Raksha insurance on your loan. To know more about SBI Global Ed-Vantage Scheme, visit the State Bank of India Education Loan
Bank of Baroda Scholar: Bank of Baroda is one of the top public-sector banks for the overseas education loan for all countries including USA. The bank understands that every study abroad student is different and thus, it has kept a different pricing scheme as per the student’s profile, course, and country. BOB has taken out a list of premier institutions dominated by educational institutions in America. BOB education loan to study in the USA has a 100% margin (for listed colleges), 12-month moratorium period, and low interest rate. To know more about Bank of Baroda Scholar, visit Bank of Baroda Education Loan
PNB Udaan: Punjab National bank’s loan scheme can be availed for studying outside India. It can also be taken for studying various diploma/degree courses and courses offered by CPA in USA, CIMA in London, etc. The maximum loan amount depends on the student’s requirements. The maximum loan tenure is of 15 years and the repayment period starts after one year of the course completion. To know more about PNB Udaan, visit Punjab National Bank Abroad Education Loan Details
Oriental Bank of Commerce Education Loan Scheme: This loan scheme is offered to Indian students who want to pursue their higher education either in India or abroad. For study in the US, the loan amount depends on the fee structure of the target institute. The margin is 15% on education loans taken for overseas, provided the amount is over INR 4 Lakhs. The maximum possible loan tenure is 15 years and the repayment starts right after the course completion. To know more OBC education loan scheme, visit Oriental Bank of Commerce Education Loans for India and Abroad
Which are the top private banks in India offering education loans to study in the USA?
There are a few private banks in India offering education loans to study in the USA. Among them, the leading ones are:
Axis Bank: One of the largest commercial private banks in India, Axis Bank offers study loans for the USA to Indian students. The maximum amount offered as unsecured loans is up to INR 40 Lakhs. The interest rate typically ranges between 11% to 13% p.a. There is no margin money for the loan amount up to INR 4 Lakhs while it is 15% for the amount above INR 4 Lakhs. Applicable moratorium period is up to 12 months after the course completion and there is no pre-payment penalty. To know more, visit Axis Bank Education Loan
ICICI Bank: One of the top private banks in India, ICICI Bank offers education loans for studying in the USA to Indian students in form of both secured and unsecured loans. The maximum loan amount that can be taken as secured loans is up to INR 1 Crore while the maximum amount offered as unsecured loans is up to INR 40 Lakhs. The interest rate starts at 11.5% p.a. There is no margin money for the loan amount up to INR 20 Lakhs while it is 15% for the amount above INR 20 Lakhs. Applicable moratorium period is up to 6 months after the course completion and there is no pre-payment penalty. To know more, visit ICICI Bank Education Loan.
Which are the top NBFCs offering education loans to study in the USA?
HDFC Credila: The first specialist education loan lender in India, HDFC Credila Financial Services offers education loans to study abroad for more than 1000 universities across about 35 countries in the world. The maximum loan amount that can be taken in form of education loan without collateral from HDFC Credila is INR 40 Lakhs. The rate of interest ranges from 11% to 12.5% p.a. Students have to pay an interest amount during the study period and the principal amount repayment starts after 6 months of course completion. The processing fees charged is 1-2% of the loan amount (plus GST) and there is no pre-payment penalty. To know more, visit HDFC Credila Education Loan.
Avanse Financial Services: One of the top NBFCs in India, Avanse Financial Services offers education loans to1,626 universities, 1,262 colleges, and more than 6,000 courses across 44 countries in the world. The maximum loan amount that can be taken in form of education loan without collateral from Avanse is INR 40 Lakhs. The rate of interest ranges from 11.75% to 16% p.a. Students have to pay a simple interest or partial interest during the study period and the principal amount repayment starts 6 months after course completion or 3 months after getting a job (whichever is earlier). The processing fees charged is usually 1% of the loan amount (plus GST) and there is no pre-payment penalty. To know more, visit Avanse Education Loan
InCred: Offering unsecured loans to study abroad on flexible terms, InCred is an NBFC that can offer up to INR 40 Lakhs as study abroad loans without collateral. The rate of interest ranges from 11.75% to 16% p.a. Applicants have to pay a simple interest or partial interest during the study period. The maximum loan tenure can be up to 10 years. The processing fees charged is usually 1% to 1.25% of the loan amount (plus GST) and there is no pre-payment penalty. To know more, visit InCred Education Loan.
Auxilo: A pro-education NBFC, Auxilo is another option for study abroad loans. The maximum loan amount that can be taken in form of unsecured education loan from Auxilo is INR 40 Lakhs (case-level exceptions are possible). The rate of interest ranges from 12.70% to 18% p.a. The processing fees charged is 1% to 2% of the loan amount (plus GST) and there is no pre-payment penalty. To know more, visit Auxilo Education Loan.
Which are the top international lenders offering education loans to study in the USA?
MPOWER Financing: MPOWER Financing offers education loans for higher studies in the US and Canada. The education loan is offered in USD and CAD without co-applicant or collateral. The maximum loan amount that can be taken in form of study loan without collateral from MPOWER Financing is up to USD 50,000. The rate of interest is around 11.99% (APR - 12.94 percent) for graduate courses and around 13.99% (APR - 14.98 percent) for undergraduate courses. There is no margin money involved and the repayment tenure can be up to 10 years. To know more, visit MPOWER Financing Education Loan.
Prodigy Finance: Prodigy Finance is a UK-based financial lender that offers education loans on the basis of their academic profile- without any collateral or co-applicant. The study abroad loan is offered in USD and EUR, depending upon the target country. The rate of interest is around APR - 9.4% There is no margin money involved and the repayment tenure can be up to 20 years. The repayment starts after 6 months od the course completion and no repayment is required during the moratorium period. To know more, visit Prodigy Finance Education Loan.
How to get an education loan in India to study in the USA?
Check your loan eligibility on GyanDhan.
Get expert loan counseling from our counselor to compare the education loan options available.
Select a lender and the application online on our platform.
Get your customized document checklist.
Submit the documents either online or get documents picked-up from your home by our representative.
Property & other legal evaluation (in loans with collateral).
Get the loan sanction letter after the lender’s approval.
How can GyanDhan help Indian students in getting a loan to study in the USA?
Skip all the hurdles by simply contacting GyanDhan. You can get the benefit from our streamlined education loan process. GyanDhan offers free help in getting education loan to study in the USA and several other major countries. Our education loan counselor will discuss the loan options available to you after understanding your profile. We work in partnership with several lenders in the market, including public sector banks, private banks, and NBFCs. With us, you will not have to worry about your abroad education loan application. To know if you are eligible for a USA study loan, check your loan eligibility now!
This is a companion discussion topic for the original entry at https://www.gyandhan.com/blogs/education-loan-to-study-in-the-usa-for-indian-students