Eligibility criteria for securing a study abroad loan without collateral in India are less stringent than traditional loans. To apply for such a loan, students need to have a confirmed admission offer from a recognized foreign institution. They should also be enrolled in a full-time program, such as a degree or diploma course. Most lenders also require students to maintain a good academic record, and some may also ask for a co-applicant, typically a parent or guardian, to guarantee the repayment. Lenders also consider the student’s future earning potential, based on the course and university they are attending, as a factor in loan approval.
The interest rates on study abroad loans without collateral typically range between 10% and 15%, depending on the lender and the student's profile. While this interest rate may seem relatively high, it is much more manageable compared to personal loans that are typically higher. Some banks and financial institutions offer schemes with lower rates for students with good academic records or for those pursuing courses in high-demand fields. The repayment tenure for these loans can range from 5 to 15 years, with flexible EMI options to accommodate the student’s post-graduation employment.