Overview | Education Loan for Germany | iSchoolConnect
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Updated on Nov 15, 2022

In Germany, there is something for everyone. In addition to being a significant academic center, Germany is a renowned tourist destination, with its bustling cities, iconic architecture, historical monuments, crowded retail malls, wonderful cuisine,  low tuition costs, a high level of living, high-quality education, safety, and security are just a few of the factors that draw international students to Germany.

All of the world's prominent academic institutes are based in Berlin. Munich, Baden-Württemberg, Frankfurt, and Heidelberg. 

Heidelberg University, Technical University of Munich, Free University of Berlin, Ludwig Maximilian University of Munich, and the Humboldt University of Berlin are all popular student destinations in Germany.

Some of the most popular disciplines in Germany are-

  • Engineering

  • Business Studies

  • IT/Computing

  • Tourism & Hotel Management

  • Visual Communications

Table of Contents

1 Eligibility

  • The candidate must be a citizen of India. 

  • The candidate must be enrolled in a university or course recognized by the banks or other financing institutions for the loan.

  • The student must be at least 18 years old, or the student's parents must apply for the loan.

  • The candidate must have been accepted into a degree program.

2 Loan Amount

The average cost of studying in Germany is approximately 11,000 to 15,000 EUR per annum. Education loans usually cover up to 85% of this amount. Some Non-Banking Financial Institutes offer 100% loans to study in Germany.

Another benefit in terms of education loans in Germany is that students can get a loan of up to 7.5 lakhs without any collateral.

3 Interest Rates

The interest rate on a German educational loan typically runs between 8.85 % to 16 %. The student's profile determines the actual interest rate.

Educational Loan Options - Without Collateral 

 Public Banks: 10%-11%

Private Banks: 11.25%-12%

Educational Loan Options - With Collateral 

Public Banks: 8.85%-10.25%

Private Banks: 11%-13.5%

4 EMI Calculator

Your student loan EMIs are calculated by the Loan EMI Calculator in a matter of seconds. The EMIs that you will be paying each month will be made very clear to you. It helps you set a budget and start saving money for your financial goals. The EMIs for your student loan that you have already paid off are shown on the amortization schedule. Additionally, you'll learn your student loan balance, which will help you manage your money better. The EMI Calculator is accessible from anywhere, including your home.

5 Loan Process

Obtaining a German education loan is as straightforward as obtaining a loan for any other study abroad place. The procedure is the same, with a few minor differences. In Germany, students are admitted to universities twice a year, in January and September.

  • Decide on the amount of Loan required.

  • Understand which banks provide loans for that particular college/university.

  • Apply for the loan

  • Submit all the necessary documents

6 Tax Benefits

Section 80E allows you to claim tax benefits on the interest paid on the total loan amount. Furthermore, once the payback begins, the tax benefits can be claimed for up to seven years in a row.

Loans are a blessing for bright students who have the potential to make it big in life but can't afford a good education due to rising costs. However, it is advisable to read the loan agreement's terms and conditions attentively.

7 Documents

Before the bank can process the loan amount, the borrower must produce a list of papers.

  • Id proof

  • Address proof

  • Admission Letter

  • Loan application (filled duly)

  • Documents on the expense of the course

  • Bank statements (Applicant/Co-Applicant)

  • Statement of assets (Applicant/Co-Applicant)

  • Proof of income ((Applicant/Co-Applicant)

Note: Document requirements vary depending on the bank's rules and regulations, so it's always a good idea to double-check the list of required documents with the bank in question.

8 Repayment

Repayment begins one year after the course is completed or six months after a job is secured, whichever comes first. Students must continue making payments after the course duration and moratorium period have passed. Students should be aware that the period of the moratorium varies depending on the loan provider.

International students will be able to work part-time to help with living expenses for a total of 20 hours a week. Furthermore, students can apply for an 18-month Residence Permit after completing their whole course duration to hunt for a job in their field of qualification. They can work any type of job to support themselves and pay off their loans.

9 Loan Providers (banks, private companies, NBFCs)

Public Banks

SBI, Bank of India, Indian Bank, Syndicate Bank, etc 

Loan amount (without collateral): Upto 7.5 lacs 

Loan amount (with collateral): Upto 1.5 crore

Interest Range: 10%-11%

Private Banks

Axis Bank, HDFC, ICICI, HSBC, etc 

Loan amount (without collateral): 40 lakhs of Indian rupees (For a few selected Universities, for others, only up to INR 7.5 Lakhs)

Loan amount (with collateral): Upto 60 lakhs

Interest Range: 11.25%-12%


Avanse, Incred, etc

Loan amount (without collateral): INR 20 lakhs (Master's courses are easier than others, and the amount is dependent on the income of the co-applicant)

Loan amount (with collateral): Upto 50 lakhs

Interest Range: 12%-16%

10 Blocked Account

Education is taken very seriously in Germany, and every detail is meticulously considered. Every year, the institution would require that a monthly sum be supplied for the student to help with his living expenses in the nation as well as finishing his study, depending on the current economic conditions and the appropriate tuition structure. This usually varies from state to state and ranges from €685 - €750 per month. This would include your lodging, living expenses, and even the cost of a travel permit.

Students are supposed to open a Student Loan Account with a local bank when they arrive in Germany, where they must deposit the 'Blocked Amount' for the whole calendar year. Every month, they'd be allowed to withdraw the sanctioned monthly amount to fulfill their costs. All overseas students wishing to pursue higher education in Germany must meet this prerequisite.

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