In today’s competitive professional world, a higher education degree from abroad can set you apart, opening doors to exciting job opportunities. Home to several oldest and top-rated universities, the UK is a favourite destination for those seeking education overseas in several fields. However, a multi-year degree in the UK is expensive, a deterrent for many students. An education loan in UK for international students can solve this problem.
Education loans provide financial assistance to students who wish to pursue their studies abroad. A study loan for the UK covers tuition fees, living expenses, travel costs, and other related expenses incurred during your stay in the UK.
They are typically offered by banks and financial institutions at competitive interest rates and flexible repayment terms.
Education Loan Eligibility for the UK
Criteria
Description
Indian citizenship
It is a common requirement that you must be an Indian citizen.
Admission into a recognised course
You should have secured admission into a recognised university or educational institution in the UK. Lenders generally require proof of admission to process your loan application.
Age limit
Most banks have an age limit of 18-35 years for loan applicants. It helps lenders manage risk by focusing on younger applicants who are more likely to secure stable employment and have a longer career to repay the loan.
Co-applicant or guarantor
A co-applicant or guarantor is usually required for loans above a certain amount.
Academic record
Lenders may consider your academic performance while assessing your loan application. A strong academic record can improve your chances of securing a loan, as it reflects your ability to handle studies and potentially repay the loan.
While these are common requirements, individual lenders, banks, or financial institutions may have additional or slightly different criteria for education loan UK.
Document Checklist for UK Education Loan
You must submit certain documents while applying for a student loan to study in UK. These documents help lenders verify your eligibility and assess your repayment capacity.
Here is a list of commonly required documents:
Duly Filled Application Form: This form provides personal, educational, and financial details.
Identity Proof: A copy of your passport, Aadhaar card, or PAN card.
Address Proof: Proof of residence, such as a rent agreement, utility bill, or bank statement.
Income Proof: Proof of income for the co-applicant (typically a parent or guardian) or guarantor, such as salary slips, income tax returns, or bank statements.
Passport Size Photographs: Recent photographs for identification and documentation purposes.
Academic Records: Copies of your school and university mark sheets to prove your academic qualifications.
Admission Letter: A copy of the admission letter from the university in the UK.
List of Other Expenses: Estimate additional expenses like travel, accommodation, and living costs.
Interest Rates for Education Loan UK
A study loan for the UK from Indian financial institutions and banks may range approximately from 8% to 14% per annum.
Banks generally offer competitive rates to attract students seeking financial assistance for their overseas education. Thus, the interest rates on a study loan for UK vary from one lender to another.
However, the exact rate depends on several factors, including whether the loan is secured or unsecured, the amount borrowed and the tenure, current market conditions, etc.
Education Loan for UK: Repayment Process
Education loans usually come with a moratorium period, which is a grace period during which you are not required to repay the principal amount. This period generally covers the duration of your studies plus an additional time (typically six months to a year) to allow you to secure employment.
During the moratorium period, you are only required to pay the interest component on the loan amount. This helps to manage the financial burden while you are still studying or looking for a job.
Once the moratorium period ends, you will need to start repaying both principal and interest in EMIs.
The repayment period varies between banks or financial institutions but is usually between 5 to 7 years after the moratorium.
When looking for an education loan for UK in India, you have several options:
Banks: Both public and private sector banks typically offer education loans with competitive interest rates and longer repayment terms. They often have specific loan schemes tailored for students studying abroad.
Non-Banking Financial Companies (NBFCs): NBFCs in India are generally quicker at processing loan applications and often offer unsecured education loans, meaning no collateral is required. This can provide faster and more easily manageable financing options for students.
Government Schemes: Various government-backed schemes provide financial assistance for studying abroad. These schemes offer subsidised interest rates or partial interest coverage based if you’re eligible.
International Financial Institutions: Some international financial institutions operating in India offer education loans for overseas studies, including in the UK. These loans may come with competitive rates and flexible repayment terms.
Scholarships and Grants: While not loans, scholarships and grants are additional options that can help reduce the overall cost of education. Many universities and organisations offer financial aid to international students depending upon certain pre-notified criteria.
Conclusion
A degree from the UK can set you apart in the professional world and provide a plethora of exciting, high-paying job opportunities. If you require financial assistance, several education loan for UK options are available. This UK education loan guide provides you with all the information you need regarding the loan process, such as eligibility criteria, documents required, interest rates, and lending options to help you along the way.
If you’re looking for a lender for education loan in UK for international students, look no further than Tata Capital. Our education loan is a reliable option for students planning to study in the UK with minimum documents required for an education loan. We provide attractive interest rates, fast approval and flexible repayment terms to make your loan and repayment experience smooth and hassle-free.
Yes, Indian students can get UK education loans in the UK.
Which is the best Bank for taking an education loan?
Before choosing the best bank for taking an education loan, you must check the maximum loan amount, interest rate, payment terms, and whether collateral is required from several reputed lenders.
Is it risky to take out a loan and study abroad?
In case of unsecured loans, the student might be asked to submit property papers as security to reduce risk of loan default.
06 May 2025
5 mins read
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