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Give Wings to Your Study Abroad Dream with Collateral Loan

Are you keen on pursuing your higher education from one of the prestigious universities across the globe? Are you determined to fulfill your childhood dream of studying abroad? If the answer is yes, then what is it that is holding you back? 

Finances! Well, if that is the case, then we have got you all covered. Studying abroad surely is an expensive choice but with the quality of education and global exposure, spending lakh on the world-class education is totally worth it. 

According to the Ministry of Human Resource Development, India is the second-largest country with 7.8 lakh students moving overseas in 2018 and 6.2 lakh in 2019 for their higher education.  

But with the increasing cost of higher education, it is becoming challenging and unaffordable for deserving aspirants to pursue their dreams of studying abroad. However, there are numerous ways of funding their studies. Today we are going to know about one of them, Education Loan with Collateral that is also called as Secured Loan. This type of education loan is provided by Nationalized Banks (NBs), Private Banks, Co-operative Banks and NBFC’s in India. 

Let us understand the term - Education Loan with Collateral

An Education Loan with Collateral is a type of loan where the applicant attaches security with loan application. The security can be movable asset like a fixed deposit, LIC Policy, Govt. Bonds or immovable asset like a flat, individual house, land (non-agricultural), shop, provided the immovable asset should be located in the urban area. The security pledged against a loan is termed as collateral.  

Although Secured Loans take a longer time in sanctioning as compared to that of unsecured loans, but it has numerous benefits.

Why do Public Sector Banks require Collateral?

Public Sector Banks (PSBs) require collateral to lower the risk involved in the credit. As the applicant has not begun to earn yet, the bank is unsure about the applicant’s future income. If the applicant fails to repay the education loan, in such circumstances, bank recovers the dues by selling the pledged security. 

Benefits of getting an Education Loan with Collateral

Paying hefty amount for overseas education surely digs a hole in the pocket but there are few ways that help students to avail added benefits. 

  • Aspirants can get high loan amount up to 1.5 Cr sanctioned from PSBs at the lowest interest rates of 8% onwards. 
  • Aspirants who have taken an education loan for overseas education can avail the tax deduction under Section 80E of the Income Tax Act, 1961. 
  • Repayment tenure of the loan is of 15 years and flexible repayment terms. 
  • If the aspirant is a girl then she is applicable to get concession of 0.50%. 
  • There is no compulsion of serving simple interest during moratorium period.
  • If the applicant wants to repay the loan in less than stipulated time-period, there will be no pre-payment and pre-closure charges applicable.
  • Collateral loans are accepted by almost all the countries and are available for all the courses at UG and PG level.
  • There are no strict criteria for co-applicant’s financial profile hence there are higher chances of loan approval. 
  • Student can get loan amount up to 80-90% of the property valuation

What are the expenses covered in Education Loan with Collateral?

While sanctioning of loan from the bank, student is required to mention about all the required expenses in the cost project in order to get it sanctioned.

List of expenses covered in education loan: 

  • Tuition fees, examination fees, library charges, lab fees, almost everything is covered.

  • Fees of on-campus or off-campus accommodation (hostel + mess expenses).

  • Air ticket. 

  • Applicant’s overseas health insurance. 

  • Purchase amount of study materials, equipments if any, uniform and laptop.

  • Other required expenses needed for completion of the course, study tours, project work.

Common eligibility criteria for applying for an Education Loan with Collateral

In order to be eligible for availing an Education Loan with Collateral, aspirants need to fulfill the following criteria: 

  • The applicant must possess all the collateral documents of the security attached. 
  • The applicant must be an Indian national. NRIs holding Indian passport can avail education loans too. Overseas Citizenship of India (OCI) students can get a loan to study in India but not for foreign education as they are no more Indian citizens. 
  • The applicant must have secured admission in the university as banks ask for a copy of the acceptance letter with the loan application. 
  • The applicant must have had a good academic history as banks ask the applicant to attach relevant mark sheets with the loan application.  
  • A good CIBIL score is a desirable criterion of most PSBs while sanctioning an education loan. 

Why should the aspirants do a comparative analysis of Nationalized Banks, Private Banks and NBFC’s before processing for the loan?

There are a majority of banks and financial institutions that provide education loans to overseas aspirants. It gives an option of comparing and analyzing the various bank criteria that helps in taking an informed decision. 

Public and private-sector banks and NBFCs provide education loan with collateral to Indian students. Let us understand the condition that needs to be taken into consideration while applying for a loan.

State Bank of India
Bank of Baroda
Axis/ICICI Bank
Study Level & Courses  

* Secured Loan for all level of courses- Bachelors & Master’s degree, UG Diploma / Cert, Grad. Diploma etc. 

* Loan for Pathway Program including Foundation / Integrated Courses) 

* Secured Loan for Bachelors degree, Masters Degree, PG/Grad. Diploma.

* No Loan for UG Diploma / Certificates courses

* Secured Loan for Graduate Degree, Masters Degree, PG / Grad. Diploma

* No loan for UG Diploma / Certificates courses

Secured Loan for all level of courses- 

* UG Degree / Diploma

* Graduate Degree, Masters

* PG / Grad. Diploma 

Quantum of Finance
Up to Rs.1.5 Crores (No Limit, if project cost is more)

* Premier Listing: Up to Rs.80 Lakhs (No limit)

* Non Premier Listing: Up to Rs.60 lakhs

* Axis – Up to Rs.75 Lakhs 

* ICICI – Up to Rs.1 Crore 

Up to Rs.50 Lakhs *
Rate of Interest 

* ROI - 9.3% 

* Less – 0.50% Concession for girl child

* Less – 0.50% towards Rin Raksha Insurance

* Premier – 8.5 % p.a & non-premier - 9.15 % p.a. 

* Less – 0.50% Concession for girl child

* ROI - 11.50 % to 13 % 
* ROI - 11%  - 13%
Margin* 90% (By Bank) + 10% (By Student on each disbursement)

* Premier: 100% funding by Bank

* Non-Premier: 90% (By Bank) + 10% (By Student)

85% (By Bank) +15% (By Student)
100 % funding by Bank
Moratorium Period
Course duration + 6 months
Course duration + 12 months
Course duration + 6 months
Course duration + 12 months
15 years
15 years
15 years
10 years
Processing Fees
Rs. 10000/- + GST
Rs. 10000/- + GST

* Loan below 20.00 lacs – No Fees 

* Loan above 20.00 lacs - Rs. 15000/- + GST

1.5% to 2% + GST on loan amount

Documents to keep handy while securing an Education Loan with Collateral

If an aspirant is looking forward to securing an education loan, then the following points should be considered.

Here is the list of documents required for securing an Education Loan with Collateral:

  • Offer Letter stating Tuition fees 
  • Student academic documents (10th to Graduation) 
  • Student employment documents (if any)
  • KYC documents to be submitted by applicants as well as Co-Applicants 
  • Electric Bill as proof of residence in the name of Co-Applicant 
  • Student, Co-Applicant’s saving account Bank statement for last 6 months 
  • Income Tax Returns of last 2 years
  • Collateral property documents should be in the name of present property owner and the documents should not be laminated

Understand the process of securing an Education Loan with Collateral in 11 simple steps: 

Our Banking Partners in India providing secured loan services

ELAN has tied up with the following banks to make the lengthy process of sanctioning loan hassle-free for the aspirants:

  • State Bank of India  
  • Bank of Baroda 
  • Axis Bank
  • ICICI Bank 
  • Avanse
  • HDFC Credila 
  • Auxilo
  • InCred
  • Bank of India
  • Credenc
  • Prodigy Finance
  • MPOWER Financing
  • IDFC First Bank

How ELAN will give wings to your Dreams of Studying Overseas?

ELAN is an exclusive platform aiming to provide customized financial solutions for overseas education loan to students across India and in the South East Asia. 

Here is a list of services that we provide Free of Cost:

  • We execute a simple loan application process that helps it easier to accelerate the faster sanctioning of loans.  
  • Our Education counselor assesses the profile of student and recommends the right lending bank according to the student’s financial profile.
  • We arrange a meeting with the branch manager or processing centre of suggested bank for the process of documentation submission.
  • Once the documents are submitted, we coordinate with the lender bank that accelerates the process of loan sanctioning.
  • Our Education counselors assist the students in pre-visa disbursement process.

We at ELAN suggest the aspirants to opt for secured education loan as it offers numerous benefits. We hope that you have got all your questions relating to secured loans answered.  

So, what are you waiting for? Book an appointment with us today and let us get started with the whole process.  


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