Education Loan For Abroad Studies
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Brinda Khurana
Brinda Khurana

Study Abroad Expert

Updated on:  25 Dec 2024 | 
Reviewed By:  Aman  
| 1.14K | 62  min read

If you're residing in Bangalore and are in search of an education loan for your studies in India or abroad, this piece is tailored for you. Average education loan requirement for students in Bangalore is about INR 15 lakhs for studies within India and INR 45 lakhs for education overseas. The interest rates for education loans in Bangalore for studies in India range from 8.5% to 13.5%. For abroad studies secured education loan rate of interest ranges between 9.25% - 12.5% whereas unsecured education loan rate of interest ranges between 9.75% - 13.5% depending on the loan type and lender. For more detailed information on securing an education loan in Bangalore, continue reading.

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Best Banks for Education Loan in Bangalore for Studies in India 

Bank Name  Loan Amount  Processing Fee

State Bank of India 

Up to INR 50 lakh

Nil - INR 10,000+Tax 

Axis Bank 

Up to INR 75 lakh (unsecured) 

Up to 2% of the amount+GST 

ICICI Bank 

Up to INR 1 crore 

Up to 2% of the amount +GST

IDFC First 

Up to INR 30 lakh (unsecured) 

Up to 1.5% of the amount 

UBI 

Up to INR 1.5 cr (secured) 

Up to INR 40 lakh (unsecured)

INR 5000 (refundable) 

HDFC Credila 

Up to INR 40 lakh 

1% + GST 

Auxilo 

Up to INR 65 lakh 

Up to 2% of the sanctioned loan amount 

InCred 

Up to INR 60 lakh

0.75% - 1% of the sanctioned loan amount

BOB 

INR 7.5 lakh - INR 1.5 cr 

1% (max. INR 10,000) 

Check Your Education Loan Eligibility

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Best Banks for Education Loan in Bangalore for Abroad Studies

Bank Name  Loan Amount  Processing fee

State Bank of India 

Up to INR 1.5 cr with collateral 

INR 10,000

Axis Bank

Prime A - INR 50 lakh 

Prime B - INR 40 lakh 

0.75% on the sanctioned loan amount 

ICICI Bank 

Up to INR 2 cr (secured) 

Up to INR 1 cr (unsecured) 

Up to 2% + GST 

IDFC First Bank

Up to INR 50 lakh without collateral 

Up to 1.5% of the sanctioned loan amount 

Union Bank of India 

Up to INR 1.5 cr (secured) 

Up to INR 40 lakh (unsecured) 

INR 5000

HDFC Credila 

Up to INR 65 lakh 

0.5% - 1% 

Avanse 

Up to INR 75 lakh 

1% - 1.5% 

Auxilo 

Up to INR 65 lakh 

0.5% - 1.5% 

InCred 

Up to INR 60 lakh 

1% - 2% 

MPower Financing

Up to 100,000 USD 

5% (adjusted in the loan amount) 

Prodigy Finance 

Up to 100% cost to study 

Up to 5%, added to loan amount 

Bank of Baroda 

Up to 1.5 cr with collateral 

INR 10,000 + GST 

*Note: Upon loan approval, students are required to pay an upfront fee of $100 to receive their sanction letter.

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Education Loan Interest Rate in Bangalore for Studies in India 

Bank Name  Interest Rate  Interest Rate Concession 

State Bank of India 

Starts from 8.30% 

0.60% Business strategy discount 0.50% - for female students 

0.50% - Rinn Raksha 

Axis Bank 

Starts from 11.5% 

0.5% - 2% 

ICICI Bank 

Starts from 10.5% -11% 

0.5% - 2% 

IDFC First 

Starts from 8.5% - 10% 

0.5% - 2% 

UBI 

Starts from 11.15% 

0.5% for female students

1% if the SI is paid in full 

HDFC Credila 

Starts from 10.25% - 12.75% 

 -

Auxilo 

Starts from 11% - 13.5% 

0.5% - 2% 

InCred 

Starts from 11% - 13.5% 

0.5% - 2% 

BOB 

Starts from 8.85% 

0.5% 
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Education Loan Interest Rate in Bangalore for Abroad Studies

Bank Name  Interest Rate  Interest Rate Concession 

State Bank of India 

Starts from 10.15% 

0.5% concession in interest for female students 

0.5% - Rinn Raksha 

Axis 

9.99% - 12.5% 

 -

ICICI 

10.25% - 12.5% 

 -

IDFC First 

9.5%-11% (secured) 

11%-13% (unsecured) 

 -

UBI 

9.25% - 9.75% 

 -

HDFC Credila 

10.25% - 12.75% 

 -

Avanse 

10.75% - 13% 

 -

Auxilo 

11.5% - 13% 

 -

InCred 

11.85% - 13.25% 

 -

MPower 

12.99% - 15.99% 

-

Prodigy 

11.5% - 13.5% 

-

BOB 

9.7% (fixed) 

0.20% concession in interest for female applicants of non-premier institutes

Check Your Education Loan Eligibility

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Education Loan Features Offered by Banks or NBFCs in Bangalore

Expenses Covered 

  • list items Fees payable to college/school/hostel.
  • list items Examination/library/laboratory fees.
  • list items Purchase of books/equipment/instruments/uniforms, purchase of computers- essential for completion of the course (maximum 20% of the total tuition fees payable for completion of the course).
  • list items Caution deposit/building fund/refundable deposit (maximum 10% of tuition fees for the entire course).
  • list items Travel expenses/passage money for studies abroad.
  • list items Any other expenses required to complete the course like study tours, project work etc.
  • list items Insurance premium for the student borrower.

    • Moratorium Period 

    Most Bangalorei-based banks have a moratorium period of course duration plus six months, or one year. The loan repayment conditions during the moratorium period varied between public banks, private banks, and NBFCs. In public banks, simple interest is charged on the loan amount; however, applicants are not required to pay simple interest during the moratorium period. During the moratorium period, commercial banks must pay compound interest. In NBFCs, EMI must be paid during the moratorium period. 

    Loan Margin 

    The loan margin is a percentage of the total loan amount to be negotiated by the student/applicant. For example, if the loan margin is about 5% and the loan amount is approximately 60 lakhs, the student would need to come up with an additional 3 lakhs to get the loan approved. In public banks, the loan margin is typically 10% of the total loan amount. In private banks, lending margins range from 5 to 10%.

    Collateral Margin 

    The collateral margin refers to the part of the loan amount that is secured by collateral. The collateral margin is typically considered in the case of secured loans. If the applicant fails to repay the loan, banks will use the collateral given by the student or applicant to retrieve the outstanding balance. 

    Calculate your Education Loan EMI

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    Documents Required for Education Loan in Bangalore 

    Documents for the Applicant and Co-applicant

  • list items Completed loan application form with all necessary details filled out by the applicant, accompanied by two passport-sized photographs. 
  • list items Acceptable proofs of identity and residency include a passport, voter ID card, electricity bill, telephone bill, ration card, bank account statement, and Aadhar card. If there's a difference between the applicant's permanent and current addresses, two separate proofs are required.
  • list items Identity verification can be done using a PAN card and a passport.
  • list items A Personal Asset and Liability Statement, as specified by the bank's branch professional, is required.
  • list items Bank statements from the last six months (personal/salary) need to be submitted. For co-applicants, credit history is necessary, and if the co-applicant is self-employed, transactions from the business over the past year must be included.
  • list items All submitted documents must be self-attested by the applicant.

    • Applicant’s Academic Documents 

  • list items Evidence of admission/enrollment in the educational program, indicating the full duration of the course.
  • list items A detailed fee structure for the course (For studies in the USA, the Form I-20 should be provided if available).
  • list items Scorecards from standardized tests such as the GRE, IELTS, or GMAT.
  • list items A printout showing the ranking of the university.
  • list items Academic transcripts and certificates for the 10th and 12th grades, as well as for any completed degrees.

    • Financial Co-applicant Income documents 

    If you get a salary:

  • list items most recent pay slips (for the last three months)
  • list items Form 16 from the preceding two years.
  • list items Employer ID card and ITR from the previous two years.

    • If you are self-employed:

  • list items Requirements for self-employed business owners include a three-year ITR, profit and loss statement, and balance sheet.
  • list items Proof of Company/Business Address

    • Other Documents 

  • list items The processing charge is INR. 11,800, which must be paid by cheque.
  • list items A letter stating that the co-applicant will be responsible for any remaining expenditures not covered by the loan. Additional checks for attorney and evaluator expenses (if your legal and valuation process is handled by the bank itself).
  • list items Affidavit by the property collateral owner (on Rs. 20 or 100 stamp paper). If the property has multiple owners, each one must give an affidavit.

    • Additional Documents 

  • list items Any pending loan statements from the prior year.
  • list items Receive a receipt for any advance payments.
  • list items If you're applying for a loan, provide a proforma invoice for the vacation, laptop, or other item.
  • list items If appropriate, a letter stating the absence of co-applicants. ITR
  • list items A letter highlighting the gaps in your profile, if any. 

    • Collateral Documents Needed for a Secured Education Loan in Bangalore

  • list items The property's title deed.
  • list items A properly recorded will, selling contract, or gift deed.
  • list items The initial registration receipt for the aforementioned agreement.
  • list items Letter of allocation from the municipal corporation.
  • list items A 30-year connection document, or a previous chain of sale paperwork showing title or EC, is necessary. It includes a 30-year history of who got the property in the previous 30-year period and from whom. If you've owned the property for over 30 years, the preceding selling documents will suffice.
  • list items Recent bills for property taxes and electricity from the same address.
  • list items A copy of the plot layout or construction design that the municipality approved.

    • Check Your Education Loan Eligibility

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    Suitable Collateral in Bangalore for an Education Loan

  • list items House, Flat, Non-agricultural land with borders.
  • list items Commercial properties (several banks)
  • list items Agricultural land
  • list items Insurance policies, and government bonds.

    • Note: In 2007, Bangalore's municipal corporation divided properties into three categories: "A Khata" properties, which are completely legal and have paid all taxes; "B Khata" buildings, which are unlawful; and "E Khata" houses, which are electronic. 

  • list items A Khata: The A Khata is often accepted for an education loan in Bangalore. An 'A' Khata certificate is awarded to a legal property in Bangalore that complies with all government requirements governing building bylaws and taxation.
  • list items B Khata: Government banks do not take B Khata, although certain private banks will accept it if it is converted into DC. A 'B' Khata refers to properties that violate building rules, are awaiting tax clearance, or do not comply with government property standards.
  • list items E Khata stands for electronic Khata, which is filed online. It allows the property owner to pay their taxes online. It is generally accepted in some government banks, although it may vary on a case-by-case basis in Karnataka, where a Khata certificate and extract are required.
  • list items Khata Certificate - A certificate is a document that states that the tax records for a certain property are in the name of the owner. It is issued by the BBMP and is required for the registration or transfer of property in the owner's name to another person.
  • list items The Extract - The extract contains all of the information about a property obtained from the property assessment registration. Such information includes the owner's name, property size, valuation, date of last assessment, property usage, demarcations, and so on. It is good for five years.
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    How to Convert B Khata into A Khata

    B Khata properties that deviate only slightly from the present building norms and regulations may be transformed to A Khata. By satisfying certain requirements, the owner of a B Khata property can upgrade it to an A Khata. Follow these few steps.

    Step 1: Apply for District Commissioner (DC) Conversion of agricultural land to non-agricultural use.

    Step 2: Pay any property taxes that are due on the property in accordance with government guidelines.

    Step 3: Get the Khata form from the BBMP office. Fill out the form with the essential information.

    Step 4: Gather all of the documentation required for filing the Khata form.

    Step 5: Pay the BBMP charge to convert your B Khata to A Khata. Submit the appropriate documents, the tax receipt, and the completed form to the Assistant Revenue Officer for the relevant area.

    In general, you should anticipate receiving your A Khata within 4 to 6 weeks of submitting the form and all required documents.

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    Common Grounds for an Education Loan Rejection in Bangalore 

    Below are the key grounds for loan rejection in Bangalore.

  • list items Poor CIBIL scores: Loan applications are denied if the co-or applicant's CIBIL score does not meet the bank's requirements. Typically, banks require a CIBIL score of 685; however, SBI accepts scores as low as 591.
  • list items Poor academic scores: The applicant's prior academic performance may influence the loan's approval.
  • list items Chosen country for higher education: Banks do not often accept third-world countries as higher education destinations.
  • list items Banks often prefer STEM studies over those in other fields since STEM courses have a higher chance of leading to employment.
  • list items Insufficient documentation: Without the proper papers, banks cannot begin the process of obtaining an education loan for you overseas. So, in order to be eligible for an education loan to study abroad, certain paperwork and income verification are required.
  • list items Collateral Issues: Gram panchayat and B khata assets are not acceptable as collateral.

    • Are you in Bangalore and looking for ways to finance your education, either domestically or internationally? GyanDhan stands out as your ultimate resource, guiding you through the maze of securing an education loan that suits your needs. With our specialized guidance, you can obtain education loans with competitive terms and enjoy a high success rate in approvals. Furthermore, our team is ready to facilitate the pre-visa disbursement process, ensuring your study abroad venture begins on solid ground. What's more, you get all this professional assistance without any charge. Dive into your academic journey by check your loan options with GyanDhan today.

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