It is no surprise that enormous numbers of students desire further education overseas. Yet, studying abroad is expensive and only affordable for some.
In this case, overseas education loan programs act as lifesavers and assist students in paying for their studies abroad.
Below, we have provided an overview of the abroad education loans in different countries for international studies.
Types of education loans
As the primary source of higher finance in India, education loans are a foundation of support for many students. Following are the categories of student loans:
1. Secured education loans
In essence, secured loans are loans supported by a piece of property. Borrowers of collateral loans must provide it to be approved for an education loan. In return for the loan, the borrower gives the lender a piece of property as collateral.
2. Unsecured education loans
Unsecured student loans don’t often demand collateral, so borrowing money for school doesn’t entail students pledging anything as security.
Loan loans are awarded to students based on a student’s academic profile and the financial profile of their co-applicant.
Financial companies giving unsecured loans are highly careful about numerous criteria since they are lending loans bearing in mind the student’s earning potential in the future.
Private banks and NBFCs offer unsecured student loans in India.
Types of education loans for various countries in the world
Following is an overview of the abroad education loan landscape in different countries:
1. Australia
- Type of Education Loan Recommended: Secured education loan
- The maximum loan amount provided: Upto 1.5 Cr
The majority of students receiving assistance from the Australian embassy obtain secured student loans from PSUs and government banks like the SBI.
This is because government banks, unlike NBFCs, have consistently demonstrated their financial dependability and reliability. But, it’s crucial to remember that the Australian embassy only accepts third-party collateral as doing so implies that the student has no alternative means of funding for their studies in Australia.
Hence, even if the students are processing through government banks, remember that the Australian embassy pays special attention to the nature of the collateral being pledged.
2. New Zealand
- Type of Education Loan Recommended: Secured education loan
- The maximum loan amount provided is INR 1.5 Cr
Secured education loans are the sole option available to students, as New Zealand does not accept NBFC loans. The New Zealand embassy dislikes utilizing other parties’ collateral as a main source of funding, so please be aware of that.
To study in New Zealand, it is thus suggested that you avoid taking out a third-party education loan. They also accept a variety of collateral, such as liquid securities like fixed deposits and real estate, which must be at least six months old.
3. United Kingdom
- Type of Education Loan Recommended: Secured education loan
- The maximum loan amount provided: Upto 1.5 Cr
For study in the UK, both types of education loans are suitable. Students are generally advised to choose a secured education loan via nationalized banks over an unsecured education loan through private banks or NBFCs if they want to take out a student loan to pay for their studies in the UK or any other country.
Although students can contact NBFCs for educational loans, asking for loans through a government bank may be your only chance of obtaining a hassle-free UK study visa.
4. USA
- Type of Education Loan Recommended: Secured/Unsecured loans
- The maximum loan amount provided: With security, up to 1.5 Cr and up to 40 Lacs (without security).
Students often get unsecured and secured education loans for their studies in the USA, although this also relies on the qualifying requirements established by the lending bank.
5. Canada
- Type of Education Loan Recommended: Secured/ Unsecured loan
- Maximum loan amount provided: Upto 1.5 Cr(with security) and 25-30 lacs(without security)
Banks often provide both unsecured and secured education loans for students in Canada. The conditions established by Canadian law must be met by students who want to study there.
Top education loan schemes for abroad studies by the Indian government
The Government of India offers several different types of educational loans that are straightforward to apply for and may be used for studies abroad.
The list of the best government student loans for study abroad is given below:
| Gujarat Government Education Loan | |
| Type | State Government Loan to Study Abroad |
| Amount Offered as Loan | Upto 15 Lakhs |
| Vidya Lakshmi Education Loan | |
| Type | Government Loan for Study Abroad |
| Amount Offered as Loan | Upto 30 Lakhs |
| Education Loan Scheme of the NBCFDC | |
| Type | Government Loan for Study Abroad through a Government Organisation |
| Amount Offered as Loan | Upto 20 Lakhs |
| Padho Pardesh Scheme | |
| Type | Government Education Loan for Abroad through Canara Bank |
| Amount Offered as Loan | Upto 20 Lakhs |
| Dr. Ambedkar Central Sector Scheme | |
| Type | Central Government Loan for Abroad Study |
| Amount Offered as Loan | Not specified |
It is usually advised to thoroughly read the loan’s terms and conditions before proceeding. We emphasize this point since it’s important to understand all the terms of the loan agreement.
