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Education Loans for Canada

Updated on Nov 15, 2022
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If you are planning to pursue higher education abroad, taking out an education loan to cover the expense of international education is the best option.

Financial institutions may be able to finance 100% of the course fee depending on the amount and your profile.  However, in order to choose the finest foreign education loan, one must carefully consider the following crucial features of the many alternatives accessible.

Table of Contents

1 Interest Rate

Even a 1% rise in the interest rate on student loans has a significant financial impact. Loan Amount: Rs. 30,00,000, Example Loan repayment will take 5 years after graduation, and the course will last 2 years. While you will pay Rs. 9.7 lakhs in interest at 10%, you will pay Rs. 10.9 lakhs at 11 percent - a difference of 1.2 lakhs for just 1%.

2 Margin Money

The amount you must pay out of your own and the bank covering the rest. If a bank offers a 0% margin, that means they will pay for all of your educational expenses.

3 Hidden Fees

Your lender may charge you a number of hidden fees that, when combined, might cost you a lot of money, such as

Some lenders charge a forex conversion fee when an international school loan is approved in INR and disbursed in another currency. This might be as high as 1.5 percent, or Rs. 45,000 on a Rs. 30 lakh loan.

4 Processing Fees

This might range from zero to 2%. It might go as high as Rs. 60,000 for a loan of Rs. 30,00,000.

5 Cost of Credit Life Insurance

Some lenders ask the applicant to get credit life insurance in order to safeguard their loan amount in the event of unforeseen circumstances. If the premium is too high, the cost of the school loan would eventually rise as well.

6 Mandatory Cross-Sell

Even though it is not needed on the applicant's end, some lenders try to cross-sell additional products before approving the education loan.

7 Interest Rate in Different Currencies

Students are usually confronted with the option of whether to take out a lower-interest education loan in dollars or a higher-interest education loan in Indian rupees.

Given the current trend of rising US$ to INR conversion rates, taking out a loan in INR, even if it comes with a higher interest rate, is prudent.

As you can see, selecting the right foreign education loan can help you save up to 6% on your education expenditures.

Name of the bank

Loan amount limit

Interest rate

Processing Fees

Loan tenure

Moratorium period

Margin Money

State Bank Of India

For India - Upto INR 20 Lakhs

For abroad - Upto INR 1.5 crore

For India - 9.55%

For abroad - 8.8% (Men); 8.3% (Women)

INR 10,000 + GST

Maximum 15 years

Course period + 6 months

10%

Bank of Baroda

For India - Upto INR 60 Lakhs

For abroad - Upto INR 80 lakhs

For India - 8.85% (Men); 8.35% (Women)

For abroad - 7.75% (Men); 8.25% (Women)

INR 10,000 + GST

Maximum 15 years

Course period + 12 months

Above INR 4 lakhs - 10%

Canara Bank

Upto INR 40 lakhs

6.90% - 8.90%

Nil

Maximum 15 years

Course period + 12 months

5% to 15%

Bank of India

For India - INR 10 lakhs

For abroad - INR 20 lakhs

8.85% - 9.85%

For India - NIL

For abroad - INR 5000

Maximum 15 years

Course period + 12 months

15%

Central Bank of India

No upper limit

9.0% (Men); 8.50% (Women)

Loans upto INR 10 lakhs - INR 500

Loan above INR 10 lakhs - INR 1000

10 - 15 years

Course period + 6 or 12 months

15%

Indian Overseas Bank

For studies in India - INR 30 lakhs

For abroad studies - INR 40 lakhs

10.05%

Nil

15 years

Course period + 12 months

5% to 15%

IDBI Bank

INR 20 lakhs

8.65% - 9.15%

For India - NIL

For abroad - INR 5000 (refundable)

10 - 15 years

Course period + 6 months

upto 15%

Karur Vysya Bank

For India - INR 10 lakhs

For abroad - INR 20 lakhs

10.75% to 11.75%

Nil

Upto 7 years

Course period + 6 or 12 months

upto 15%

United Bank of India

For India - INR 10 lakhs

For abroad - INR 20 lakhs

10.65% - 11.40%

Nil

10 - 15 years

Course period + 6 or 12 months

upto 15%

Union Bank of India

No upper limit

Up to Rs.7.50 lakhs: 12.25%

Above Rs.7.50 lakhs: 12.00%

Nil

15 years

Course period + 12 months

15%

Indian Bank

For India - INR 15 lakhs

For abroad - INR 25 lakhs

12.50%

-

10 - 15 years

Course period

5% to 15%

UCO Bank

For India - INR 10 lakhs

For abroad - INR 20 lakhs

Up to Rs.7.50 lakhs: 11.20%

Above Rs.7.50 lakhs: 12.20%

Nil

Up to 15 Years

Course period + 1 year

For India - 5%

For abroad - 15%

Punjab National Bank

INR 40 lakhs to INR 60 lakhs

8.80% to 9.55%

1% of the loan amount

15 years

Course period + 12 months

15%

Oriental Bank of Commerce

For premium colleges - INR 20 lakhs

For others - INR 10 lakhs

7.30% - 9.30%

-

Up to 15 Years

Course period + 12 months

15%

Andhra Bank

INR 20 lakhs

11.15% to 11.45%

-

5-7 years

Course period + 12 months

upto 15%

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