Higher education often involves significant financial investment. Education loans from providers like SBI, Bank of Baroda (BoB), and Avanse Financial Services can help. Here’s a comparison to guide your decision.
SBI Education Loan
State Bank of India has many education loan schemes that are focused on studying within India and outside India. Let’s see some of them as follows:
- Loan Options:
- SBI Student Loan Scheme: Covers up to ₹7.5 lakh for domestic studies.
- SBI Scholar Loan Scheme: Offers competitive interest rates for premier institutions.
- SBI Global Ed-Vantage Scheme: For overseas education loans above ₹20 lakh.
- Interest Rates:
- Linked to the External Benchmark Rate (EBR), starting at 8.50% for the Global Ed-Vantage Scheme.
- Additional concessions:
- 50% reduction for female students.
- 50% discount for opting for SBI’s insurance policy.
- Repayment Terms:
- Flexible repayment tenure of up to 15 years.
- Simple interest during the course and moratorium period.
Why Choose SBI?
- Trusted government-backed bank.
- Special concessions for female students.
- Wide branch network for easy access.
Bank of Baroda Education Loan
Bank of Baroda education loan offerings are ideal for students looking for flexible terms and competitive rates. Here’s what they provide:
- Loan Options:
- Baroda Scholar Loan: Designed for international studies with collateral-backed funding.
- Premier Institutions Loan: Special rates for students from top-tier institutions.
- Interest Rates:
- Starts from 8.55%, varying with the institute and course.
- Concessions include up to 1% discounts for certain universities and girl students.
- Processing Fees:
- Amounting to ₹10,000 or 1% of the amount disbursed as a loan for the first time.
- Repayment Terms:
- Up to 15 years, which allows the student to enjoy life after completing their degree.
Why Bank of Baroda?
- Has the lowest rates with special terms offering more value.
- Lowers the cost of repayments for students at top-lying universities.
- Has various financing plans for listed and non-listed universities.
Avanse Education Loan
One of the leading NBFCs, Avanse Financial Services, provides education-oriented loans for various purposes. Unlike banks, Avanse is fast and customized.
- Key Features:
- Includes tuition fees, cost-of-living, and other expenses such as travel and cost of equipment.
- Loans can be taken out against the university, course, and profile of the student.
- Interest Rates:
- Depending upon their credit profile, the standard range is between 10.5% to 16.5%.
- Processing Fees:
- 1% to 2% of the loan amount.
- Repayment Terms:
- Loans are offered with a moratorium for the entire period of study and six months more after that to start repayment.
Why Avanse?
- Minimal documents are required, and quick loan sanction.
- Has flexible time and terms for repayment.
- Includes and pays for many more options than the tuition fee.
Factors to Consider While Choosing an Education Loan
- Competitive rates: Look for rates with low structure, as this will make payments easier in the long term.
- Processing Fees: Avoid hidden costs by looking at extra expenses that external lenders may impose.
- Repayment Terms: Choose lenders that would provide a grace period and a longer repayment process.
- Loan Amount to Amount Financed Ratio: The loan should be sufficient and cover several aspects, such as fees, the cost of living, etc.
- Disincentives: Search for specific disincentives given to women students or students studying in specific Tier 1 colleges.
Final Verdict
- Take a look at SBI, the ideal institution for many, which offers low interest rates and even greater benefits, such as concessional rates for female students.
- Choose Bank of Baroda if you want both freedom and the option of using inexpensive rates while studying overseas or within the country.
- If you want to get approved quickly and have custom loan options for different spending, Avanse is the right choice.
- Each provider has distinctive benefits, and your selection should meet your educational and financial needs, respectively.
Looking for Expert Guidance?
Navigating the education loan process can be complex, but you don’t have to do it alone. Eduloans offers personalized counseling to help you secure the best loan and ensure a hassle-free application process. Contact us today to make your study abroad consultants a reality!
FAQs
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Do education loans cover living expenses?
Yes, all three providers cover living expenses in addition to tuition fees. -
Are tax benefits available for education loans?
Yes, interest paid on education loans qualifies for tax deductions under Section 80E. -
Is collateral required for these loans?
SBI and BoB require collateral for higher amounts, while Avanse may not. -
What are typical repayment terms?
Most loans offer a tenure of 10-15 years, with a moratorium during the course. - Which lender has the fastest approval process?
Avanse processes loans faster, often within a few days, compared to banks.