In March 2020, when the COVID-19 hit the world, almost every industry was hit hard. The education loan sector was also no exception as both students and lenders became skeptical of how everything will pan out. Over the course of time, things are certainly getting better.
Students are carefully looking at how various countries are handling their pandemic response, and which institutions are providing support to international students – while they choose their dream colleges.
Over the past few years, the concept that Indian students only move abroad to the USA for education has decreased. The number of students pursuing their further education in countries such as Canada, UK, and Ireland has increased owing to both the excellence of educational universities and also the openings for global jobs there. Ireland particularly is seeing interest from undergraduates.
What is trending?
With openings rising leaps and bounds globally, the longing in Indian students is widespread in hoping to study abroad. Also, lenders in India are slowly becoming less risk-averse. 4-5 years back, the U.S. was the only country for which banks were interested in sanctioning loans. However, in recent years, with countries like the U.K. and Canada increasingly making their immigration policies more suitable for international students and growth of job opportunities there have compelled lenders in India to look beyond America.
Education loans for studies abroad
Studying abroad is one of the crucial aspects is education loans.
While early on in the expedition, a student nowadays can use diverse platforms to understand what loans he/she should get, at what rates, and from which sources. If you looking best credit card machines then you should visit the card provider.
While looking for an education loan to study abroad, parents must keep these 3 things in mind before choosing loans:
- What is the interest rate levied? It can be from 0 percent to anywhere up to 24 percent IRR.
- Is the banker a listed NBFC with RBI so the client would know the interest calculation would be fair and crystal clear?
- While an education loan comes with the elasticity of repaying in 6-12 months as equated to other payment options like credit card or cash/banking portal it must be kept in mind that this is a loan and affects credit score in case of non-payment.
Why is education overseas being preferred?
Pursuing studies internationally is a rewarding dream for any pupil. A part-time job in the destination country will make sure one has ample time on hand to complete projects, assignments, attend classes and at the same time earn extra money. This gives the youth of today the exposure they need and the hands-on experience of living independently.
How to go about an educational loan in current times?
Soon after securing admission, one needs to finalize the loan amount. An applicant can avail up to a maximum of INR 20 lakhs at a nominal interest rate and it has to be repaid within 15 years. Similarly, if the loan total is more than INR 7.5 lakhs, then borrowers have to furnish collateral as security. The payment starts after one year of completion of the course. As there are a few education loan consultants that have emerged in India recently, students can take their help to get their loan done. Click here to know more about how to apply for education loans to study abroad.
Current trends and Covid-19
Banks, especially those in the civic sector, supportive of higher education and dreams of Indians, outside the country, are no longer news.
Though, their current decision to give loans to control the dreams of Non-Resident Indians (NRIs) and Persons of Indian Origin (PIO)/ Overseas Citizens in India (OCI) eager on getting a degree from an Indian institute of higher learning, is news for overseas Indians to sit up and consider.
The restored loan policy will be a motivation for meritorious pupils belonging to the NRI/PIO/OCI category to follow studies in universities.
What current trends speak of?
Demand for study loans rose to a record level in the year 2020. It was a year when most schools and colleges in India and all over the globe were forced to conduct classes online due to the Coronavirus. Education loan lenders – which include banks and non-banking financial companies – disbursed Rs 11,000 crore loans in the 12 months through September 2020, as per the data from CRIF High Mark, a credit bureau (Source: Economic Times). As more and more students are eager to go abroad, the demand for abroad education loans is bound to rise in the coming future. However, to cater to this demand, banks in India need to fine-tune their loan process and make the process easier and faster.