Education Loan for NRI Students to Study Abroad

NRI or non-resident Indians can apply for education loans from India. The Education loan helps them to cover their travel expenses, living expenses, tuition fees, and other miscellaneous expenses. Getting an education loan is more feasible as the co-applicant can avail of tax benefits, the value of Indian currency weighs less against the dollar,  and the student loan policies are of International standard. As a result, an education loan for NRI to study abroad is a great idea. Keep reading to know more about the education loan for NRI students.

Why would an NRI take an Indian Education Loan?

There are several reasons why an NRI would take an education loan.  Some of them are listed below:

• Taking an Indian education loan means that the payment can be made in Indian currency. 
• The education loan lenders charge low-interest rates and flexible terms and conditions
• The terms and conditions are better suited for the requirements of an NRI student 
• Less documentation is required and online facilities are available to help with the loan application 

NRI Education Loan Lenders 

The education loan for NRI to study abroad is provided by education loan lenders. Below are the NRI education loan lenders in India.

• Public banks such as State Bank of India, Bank of Baroda, and so on provide education loans for r NRI  to study abroad. However, these banks do not offer loans for more than INR 7.5 lakh unless the collateral is provided.  Depending upon the collateral value and the requirement a maximum amount of INR 1.5 cores can be availed.
• At private banks such as Axis bank and ICICI NRI, students can get loans up to INR 40 lakhs. It can be an unsecured loan. The secured loan maximum limit depends upon the bank.
• NBFCs- The Non-Banking Financial Company also offers education loans. Some of the popular NBFCs in India are Credila, Avanse, Auxilo, and InCred. A maximum amount of INR 60 lakhs is provided for NRI students.
• International lenders such as Prodigy Finance, MPower, and Leap Finance can cover up to 80% of the expenses of the student. These students do not require collateral or co-applicant.

Expenses Covered Under Education Loan

The education loan for NRI to study abroad covers the following expenses.

S.No	Expenses covered under education loan
1	Tuition fees payable to the university
2	Hosel fees
3	Exam, library, and laboratory charges
4	Caution deposit, Building fund/ refundable deposit supported by Institution bills/ receipts
5	The borrower’s Insurance premium
6	Books, equipment, instruments, and uniform expenses
7	The laptop or desktop expense
8	Travel expenses like fight tickets
9	Cost of admission
10.	Other expenses such as study tour, project work, and thesis expenses

Must Read: Types of Education Loans for Indian Students

Eligibility Criteria 

The general requirements for an education loan for NRIs to study abroad are:

• An Indian national with a strong academic record
• Parents need to apply on behalf of the student who is below 18 years of age 
• Must have received admission from a reputed International university, institution, or college
• The technical and professional courses will be preferred as banks favor job oriented course
• Other norms and standards are set by the loan provider to ensure that the loan given is safe and secure.

Power of Attorney 

An additional process that is involved in the education loan for NRI to study abroad is the POA. A power of attorney (POA)  gives the right to one person to act on behalf of another person. It is a legal document that gives either full or limited authority to an individual to take all the legal actions and financial decisions. 

In the absence of the NRI student in India, the POA is given to another person who can take an education loan, and complete the necessary financial transactions and legal documents. There are several situations when a POA is needed.

• NRI student’s parents are living in IndiaIn in such circumstances the signatory rights can be transferred by the student to his/her parents or sibling. The person who has the POA can sign documents on behalf of the student. Moreover, the signatory rights holder is responsible for bringing all the documents to the bank.
• NRI students and parents. When both parents and the students are NRI the POA can be given to extended family members. To give a secured loan the extended family member needs to have a good income source to pay the EMI to the bank. A collateral has to be pledged in case of an unsecured loan. Only NBFC accepts the first cousins and parents’ siblings as POA.
• Indian student with NRI parents- Unsecured loans can be taken by immediate family members. However, secured collateral has to be provided by the parent and the process can be completed by giving the POA to the other parent or Indian relatives.

Must Read– List of Top International Student Loans

Documents Required for NRI Education Loan

The education loan for NRI to study abroad requires the following documents.

• Application form along with the documents of the student and the co-applicant
• Residential proof, and the Identity proof of the student and the co-applicant. The identity proof can be a driving license, Pan Card, Voter ID card, Aadhar card, or passport 
• The mark sheet and the academic transcripts of the student
• Proof of GRE/GMAT scores (If applicable), and proof of English language proficiency. For example, IELTS/TOEFL/PTE scorecards.
• Proof of admission to an International university. For this, the admission letter can be provided.
• Last 6 months’ bank statements and the income proof of the co-applicant 
• Collateral of immovable property needs to be provided. For example, non-agricultural land, and flats. The documents for the same have to be presented. The documents can be property title deeds, building-approved plans, or NOC for a mortgage from a builder or society.

The technical and legal documentation

Apart from the above-mentioned documents, there are additional documents required to get an education loan for NRI to study abroad. These documents are as follows:

Technical Documents	Legal Documents
Title deed	Khata Certificate and extract in the name of the current owner
Revenue document (Khata / Patta)	Encumbrance certificate – Minimum 13 years reflecting all sale transactions
Copy of approved layout plan and permissions case specific	Sale /gift/partition deed in favor of customer – Minimum 13 years
Bda Allotment -NOC and allotment letter	A latest Property tax receipt
Non-Encumbrance certificate	–
Possession Certificate (In case the flat is taken from a builder)	—
Copy of Prior sale deeds	—
Conversion certificate	–
Urban clearance certificate (Case-specific)	–

Must Read– Education loan without collateral

Procedure for Education Loan

Education loan for NRI to study abroad requires certain procedures to be followed. These are-

• Receive admission to an International university and then focus on applying for an Education loan for NRI to study abroad.
• Be aware of the placement opportunities provided by the university. Good placement opportunities mean that the bank will grant you loans easily. 
• Know the exact amount required for completing the course. It includes tuition fees, book fees, and so on.
• Check the margin money, compare interest rates of different banks, and apply for the loan.
• Finally, wait for the loan to disburse. When your loan is approved you will receive a sanction letter from the bank or NBFC.

FAQs 

Education loans for NRI to study abroad are available. Interested students can apply to the bank of their choice for an education loan. An education loan will help the student to cover their living expenses, tuition fees, and other miscellaneous expenses.  To discover more such articles visit the study abroad experts at Leverage Edu.