Content

1. What is a non-Collateral Education Loan?
2. Collateral free study abroad loan providers in India
3. NBFCs for non-collateral education loan
4. Eligible countries and courses 
5. Documents Required

What is a Non-Collateral Education Loan?

A loan that does not require you to pledge any collateral against the loan amount is called a Non-Collateral education Loan. 

Parameters considered while getting Non-collateral loan are-

- Test (GRE, TOEFL) score (GRE score of 300+ is preferred) 

- 10th, 12th, and higher degree CGPA

- Co-applicant’s income

- Student’s earning potential after the education

Who is a Co-applicant?

A Co-Applicant is a person who can pay your loan in case the student is unable to do so. Co-applicant is usually a blood relative, he or she can be either your parents, sibling, etc. Note - Spouses are not eligible to be a co-applicant in the case of NBFCs but some banks do allow.

Non-Collateral study abroad loan providers in India

The three types of entities which provide study abroad education loans in India are-

1. Public Banks
2. Private Banks
3. NBFCs

Govt. banks can provide a maximum of 7.5 Lakh INR in case of non-collateral education loan which is not enough for education abroad because of which NBFCs are preferred for non-collateral education as they can provide up to INR 50 Lakh depending on the student profile.

NBFCs for non-collateral education loan

NBFCs which provide non-collateral education loans to Indian student are-

1. Prodigy Finance
2. Avance Finance
3. InCred
4. HDFC Credila
5. Auxilo

Eligible Countries and Courses

NBFCs provide non-collateral education loans are only provided for a particular set of countries and courses

The amount of loan offered by NBFCs depends on the education destination, course, university or college. The loan amount offered by NBFCs country wise-

USA - up to 50 Lakh INR

Germany - Upto 20 Lakh INR

Australia - Upto 15 Lakh INR

Canada - Up to 30 Lakh INR

NBFCs mostly provide non-collateral loans for masters in STEM courses, chances of a non-collateral education loan for other courses is slim.

Interest Rate

The rate of interest varies between 10.75% to 14%, depending on the parameters discussed above.

Processing fee and time

Non-collateral education loans take less time to process as compared to collateral loans because there are no collateral documents to verify and other such things. 

NBFCs take 1 to 2 weeks to process a non-collateral education loan.

Documents Required

-For Co-Applicant

1. Co-applicant income proof
2. Income Tax Returns
3. CIBIL Score