Education Loan for Canada
Education Loan to Study in Canada
Canada is a top choice for international students due to its prestigious universities and diverse opportunities. However, studying in Canada comes with significant costs, including tuition fees and living expenses. On average, international graduate students can expect tuition fees of around CAD 21,000. To manage these expenses, education loans play a crucial role, not only in funding studies but also in fulfilling financial proof requirements for a Canadian student visa.
Types of Education Loans for Canada
Broadly, the abroad education loan options for Indian students to study in Canada fall under two brackets:
These are:
Secured Education Loan: This loan requires collateral, which can be movable assets like Fixed Deposits and insurance or immovable assets like residential or commercial property. Most public banks in India mandate collateral for education loans abroad.
Unsecured Education Loan: This loan does not require collateral but comes with higher interest rates due to increased risk for lenders. A co-applicant or co-signer is usually required, and the loan amount depends on their income and CIBIL score.
Secured Education Loans for Studying in Canada
Secured education loans require pledging collateral, allowing students to access higher loan amounts compared to unsecured loans. An added advantage is that these loans may not require a co-applicant. Two public sector banks that offer secured education loans for Canada are the State Bank of India (SBI) and the Union Bank of India (UBI).
| Lender Name | Maximum Loan Amount (in INR) | Rate of Interest | Margin Money |
|---|---|---|---|
| SBI | Up to 1.5 Cr |
10.65% (for Girls), 11.50% (for Boys) |
10% |
| UBI | Up to 1.5 Cr |
10.5%, 11.85% |
10% (Listed University) 15% (Non Listed University) |
Unsecured Education Loan in Canada
If you don’t have collateral, private banks, NBFCs, and international lenders offer unsecured education loans. Private banks and NBFCs require a co-applicant with a stable income, while international lenders provide loans without a co-applicant or collateral, though at higher interest rates. Loans from international lenders in CAD can help save forex charges.
Each lender has its pros and cons, so a comparative analysis has been prepared to help you choose the best option. These loans are available for Bachelor’s, MBA, Master’s, and PGDM courses. Loan terms and interest rates may vary as of January 2025.
| Lender Name | Maximum Loan Amount | Rate of Interest | Margin Money |
|---|---|---|---|
| Axis Bank | Up to INR 40 Lakhs | Starting at 11% | 5% of the loan amount |
| ICICI Bank | Up to INR 40 Lakhs | 10.85% to 15.5% | 0% to 15% |
| IDFC FIRST Bank | Up to INR 75 Lakhs | 11% to 12.25% | Nil |
| HDFC Credila | Up to INR 50 Lakhs | 10.25% to 12.75% | Nil |
| Auxilo | Up to INR 40 Lakhs | 10.5% to 13% | Nil |
| Incred | Up to INR 40 Lakhs | 11.65% to 13.5% | Nil |
| Avanse | Up to INR 40 Lakhs | 12% to 13.25% | Nil |
| MPower Financing | Up to 100,000 USD |
12.99% (Graduate Programs),
13.99% (Undergraduate Programs) |
Nil |
| Prodigy Finance | Up to 100,000 USD | 12% to 14% | 15% to 30% of overall expenses |
Study Programs Eligible for an Educational Loan for Canada
Various programs are eligible for education loans in Canada.
Here are some of them:
Undergraduate courses
Postgraduate courses
UG & PG diploma programs
Doctoral programs
Vocational and technical courses
Before applying for a loan, students must ensure their chosen program is eligible for financial support through their preferred loan provider.
Loan Sanction & Pre-Visa Disbursemen Process
Once the loan is sanctioned, the applicant receives a loan agreement outlining all terms. It’s essential to review it carefully before proceeding with disbursement.
For a Canadian student visa, a pre-visa loan disbursement is required as per Canada Immigration Authorities’ guidelines.
Expenses Covered by Abroad Education Loan for Canada
You can choose to receive the entire sanctioned loan amount at once or in periodic disbursements based on your needs. Opting for periodic disbursals is recommended to avoid unnecessary interest charges, as interest applies only to the disbursed amount, not the total sanctioned amount.
The expenses covered under the loan will depend on the lender and may include:
| Cost to Study | Living Expenses | Other Costs |
|---|---|---|
| Tuition fee | ---- | ---- |
| Admission fee | Accommodation or hostel cost | Expenses for travel |
| Examination fee | Food costs | Health insurance expenses |
| Expenses for books, or laptop | Caution fee | Miscellaneous expenses |
| Expenses for study tours | ---- | ---- |
Eligibility to Get Abroad Education Loan for Canada
To obtain an education loan in Canada as an international student, there are certain prerequisites that must be met.
Applicant must have Indian citizenship.
These include having a confirmation of acceptance from a recognized Canadian institution for a full-time program.
You should be at least 18 years old.
Must have a good academic record.
Additionally, the chosen course of study should have strong career prospects in relation to unsecured loans, and for secured loans, collateral must be provided.
Documents Required for an Abroad Education Loan to Study in Canada
Before applying for an education loan to study in Canada, students must ensure they have all the necessary documents. The documentation process can be extensive, so having a well-organized checklist can streamline the submission process.
Some of the essential documents required for securing an education loan for Canada include:
Applicant’s KYC documents.
Proof of admission: admission letter from university/institution
Fee structure from the university
Loan application form
Passport-size photographs
Income proof of the co-applicant (for unsecured education loan)
Academic transcripts (School and Bachelors)
Standardized test scores - GMAT or GRE
English proficiency test score - IELTS, TOEFL or Duolingo
Resident proof of the applicant and co-applicant
Property papers (in case of secured education loan)
Bank statement for the last 3 months
Leading Banks and Financial Institutions Offering Education Loans for Canada
Many banks and non-banking financial companies in India offer education loans for studying in Canada.
Some of the most popular ones include:
| Types | Banks |
|---|---|
| Nationalized Banks | State Bank of India, Bank of Baroda, Bank of India, Union Bank of India, Bank of Maharashtra |
| Private Banks | Axis Bank, ICICI Bank, IDFC First Bank |
| Co-Operative Banks | Saraswat Bank |
| NBFCs | HDFC Credila, Avanse, Incred, Auxilo, Credenc |
| International Lenders | MPower Finance, Prodigy Finance |
Guaranteed Investment Certificate (GIC)
To meet Canadian visa requirements, international students must open a GIC account with CAD 10,000 as proof of living expenses. This serves as a short-term liquid investment for one year, offering a guaranteed return.
GIC accounts can be opened online with banks like Scotiabank, ICICI Bank Canada, HSBC, SBI Canada Bank, and CIBC. Students must deposit CAD 10,000 plus a CAD 200 processing fee to receive an “Investment Balance Confirmation,” required for the visa application.
Upon arrival in Canada, students must open a personal bank account. An initial CAD 2,000 is transferred, while the remaining CAD 8,000 is disbursed in CAD 666 monthly installments for living expenses.
How to Get an Abroad Education Loan to Study in Canada?
Securing an education loan for Canada can take time, so it’s best to start 4–6 months before your course begins.
Below mentioned steps will guide you through the process.
Check Eligibility: Begin by assessing your eligibility for an education loan based on your financial and academic background.
Expert Guidance: After submitting your details, a loan expert will assist you in understanding the next steps.
Document Checklist: A tailored checklist will be provided, outlining required documents and possible alternatives for easier arrangement.
Verification & Approval: Once documents are submitted, verification begins (7–15 days depending on the lender). Upon approval, an agreement letter will be issued for signing. Loan application progress can be tracked in real time.
Loan Disbursement: After signing the agreement, initiate the disbursement process as per the lender’s procedure. Some lenders transfer funds to your account, while others disburse directly to the university.
Loan Sanction & Pre-Visa Disbursement Process
Once the loan is sanctioned, the applicant receives a loan agreement detailing terms and conditions. Reviewing the document carefully is essential before proceeding with disbursement.
For a Canadian visa, a pre-visa loan disbursement is required as per the guidelines set by Canada Immigration Authorities.
Repayment of Abroad Education Loan for Canada?
When choosing an education loan for Canada, consider key repayment factors like interest rates, tenure, and moratorium options. Lenders offer various repayment plans, including Partial Simple Interest (PSI), Simple Interest (SI), and Equated Monthly Installments (EMI).
| Lender Name | Repayment Tenure | Repayment Option during Moratorium |
|---|---|---|
| SBI | Up to 15 years | No payment or only SI |
| UBI | Up to 15 years | No payment or SI |
| Axis Bank | Up to 15 Years | SI or EMI |
| ICICI Bank | Up to 10 Years | SI or EMI |
| IDFC FIRST Bank | Up to 12 Years | PSI or SI or EMI |
| HDFC Credila | Up to 15 Years | PSI |
| Auxilo | Up to 15 Years | SI |
| Incred | Up to 15 Years | PSI or SI |
| Avanse | Up to 15 Years | PSI or SI |
| MPOWER Finance | Up to 15 Years | SI |
| Prodigy Finance | Up to 15 Years | SI |
Frequently Asked Questions
Yes, a PG Diploma from Canada is highly valuable. With excellent educational institutions, practical training, and international recognition, it enhances job prospects and opens doors to global career opportunities.
A PG Diploma is a specialized postgraduate qualification obtained after completing a Bachelor’s degree, providing focused knowledge and practical training in a specific field. It enhances job prospects by equipping students with specialized skills.
Yes, you can get an education loan for Canada even if you are NRI. The main concept would be sharing the power of attorney with someone related to you that is in India that can complete the process on your behalf.
Yes, you can get UG Diploma education loan for Canada. You can get up to 50 Lakh INR if you are eligible as per lender requirements.
Applicants for a Canada student visa must demonstrate a minimum bank balance of 10,000 CAD.
Education Loan to Study in Canada
Canada is a top choice for international students due to its prestigious universities and diverse opportunities. However, studying in Canada comes with significant costs, including tuition fees and living expenses. On average, international graduate students can expect tuition fees of around CAD 21,000. To manage these expenses, education loans play a crucial role, not only in funding studies but also in fulfilling financial proof requirements for a Canadian student visa.
Types of Education Loans for Canada
Broadly, the abroad education loan options for Indian students to study in Canada fall under two brackets.
These are:
- Secured Education Loan: This loan requires collateral, which can be movable assets like Fixed Deposits and insurance or immovable assets like residential or commercial property. Most public banks in India mandate collateral for education loans abroad.
- Unsecured Education Loan: This loan does not require collateral but comes with higher interest rates due to increased risk for lenders. A co-applicant or co-signer is usually required, and the loan amount depends on their income and CIBIL score.
Secured Education Loans for Studying in Canada
Secured education loans require pledging collateral, allowing students to access higher loan amounts compared to unsecured loans. An added advantage is that these loans may not require a co-applicant. Two public sector banks that offer secured education loans for Canada are the State Bank of India (SBI) and the Union Bank of India (UBI).
| Lender Name | Maximum Loan Amount (in INR) | Rate of Interest | Margin Money |
|---|---|---|---|
| SBI | Up to 1.5 Cr |
10.65% (for Girls), 11.50% (for Boys) |
10% |
| UBI | Up to 1.5 Cr |
10.5%, 11.85% |
10% (Listed University) 15% (Non Listed University) |
Unsecured Education Loan in Canada
If you don’t have collateral, private banks, NBFCs, and international lenders offer unsecured education loans. Private banks and NBFCs require a co-applicant with a stable income, while international lenders provide loans without a co-applicant or collateral, though at higher interest rates. Loans from international lenders in CAD can help save forex charges.
Each lender has its pros and cons, so a comparative analysis has been prepared to help you choose the best option. These loans are available for Bachelor’s, MBA, Master’s, and PGDM courses. Loan terms and interest rates may vary as of January 2025.
| Lender Name | Maximum Loan Amount | Rate of Interest | Margin Money |
|---|---|---|---|
| Axis Bank | Up to INR 40 Lakhs | Starting at 11% | 5% of the loan amount |
| ICICI Bank | Up to INR 40 Lakhs | 10.85% to 15.5% | 0% to 15% |
| IDFC FIRST Bank | Up to INR 75 Lakhs | 11% to 12.25% | Nil |
| HDFC Credila | Up to INR 50 Lakhs | 10.25% to 12.75% | Nil |
| Auxilo | Up to INR 40 Lakhs | 10.5% to 13% | Nil |
| Incred | Up to INR 40 Lakhs | 11.65% to 13.5% | Nil |
| Avanse | Up to INR 40 Lakhs | 12% to 13.25% | Nil |
| MPower Financing | Up to 100,000 USD |
12.99% (Graduate Programs),
13.99% (Undergraduate Programs) |
Nil |
| Prodigy Finance | Up to 100,000 USD | 12% to 14% | 15% to 30% of overall expenses |
Study Programs Eligible for an Educational Loan for Canada
Various programs are eligible for education loans in Canada.
Here are some of them:
- Undergraduate courses
- Postgraduate courses
- UG & PG diploma programs
- Doctoral programs
- Vocational and technical courses
Before applying for a loan, students must ensure their chosen program is eligible for financial support through their preferred loan provider.
Loan Sanction & Pre-Visa Disbursemen Process
Once the loan is sanctioned, the applicant receives a loan agreement outlining all terms. It’s essential to review it carefully before proceeding with disbursement.
For a Canadian student visa, a pre-visa loan disbursement is required as per Canada Immigration Authorities’ guidelines.
Expenses Covered by Abroad Education Loan for Canada
You can choose to receive the entire sanctioned loan amount at once or in periodic disbursements based on your needs. Opting for periodic disbursals is recommended to avoid unnecessary interest charges, as interest applies only to the disbursed amount, not the total sanctioned amount.
The expenses covered under the loan will depend on the lender and may include:
| Cost to Study | Living Expenses | Other Costs |
|---|---|---|
| Tuition fee | ---- | ---- |
| Admission fee | Accommodation or hostel cost | Expenses for travel |
| Examination fee | Food costs | Health insurance expenses |
| Expenses for books, or laptop | Caution fee | Miscellaneous expenses |
| Expenses for study tours | ---- | ---- |
Eligibility to Get Abroad Education Loan for Canada
To obtain an education loan in Canada as an international student, there are certain prerequisites that must be met.
- Applicant must have Indian citizenship.
- These include having a confirmation of acceptance from a recognized Canadian institution for a full-time program.
- You should be at least 18 years old.
- Must have a good academic record.
- Additionally, the chosen course of study should have strong career prospects in relation to unsecured loans, and for secured loans, collateral must be provided.
Documents Required for an Abroad Education Loan to Study in Canada
Before applying for an education loan to study in Canada, students must ensure they have all the necessary documents. The documentation process can be extensive, so having a well-organized checklist can streamline the submission process.
Some of the essential documents required for securing an education loan for Canada include:
- Applicant’s KYC documents.
- Proof of admission: admission letter from university/institution
- Fee structure from the university
- Loan application form
- Passport-size photographs
- Income proof of the co-applicant (for unsecured education loan)
- Academic transcripts (School and Bachelors)
- Standardized test scores - GMAT or GRE
- English proficiency test score - IELTS, TOEFL or Duolingo
- Resident proof of the applicant and co-applicant
- Property papers (in case of secured education loan)
- Bank statement for the last 3 months
Leading Banks and Financial Institutions Offering Education Loans for Canada
Many banks and non-banking financial companies in India offer education loans for studying in Canada.
Some of the most popular ones include:
| Types | Banks |
|---|---|
| Nationalized Banks | State Bank of India, Bank of Baroda, Bank of India, Union Bank of India, Bank of Maharashtra |
| Private Banks | Axis Bank, ICICI Bank, IDFC First Bank |
| Co-Operative Banks | Saraswat Bank |
| NBFCs | HDFC Credila, Avanse, Incred, Auxilo, Credenc |
| International Lenders | MPower Finance, Prodigy Finance |
Guaranteed Investment Certificate (GIC)
To meet Canadian visa requirements, international students must open a GIC account with CAD 10,000 as proof of living expenses. This serves as a short-term liquid investment for one year, offering a guaranteed return.
GIC accounts can be opened online with banks like Scotiabank, ICICI Bank Canada, HSBC, SBI Canada Bank, and CIBC. Students must deposit CAD 10,000 plus a CAD 200 processing fee to receive an “Investment Balance Confirmation,” required for the visa application.
Upon arrival in Canada, students must open a personal bank account. An initial CAD 2,000 is transferred, while the remaining CAD 8,000 is disbursed in CAD 666 monthly installments for living expenses.
How to Get an Abroad Education Loan to Study in Canada?
Securing an education loan for Canada can take time, so it’s best to start 4–6 months before your course begins.
Below mentioned steps will guide you through the process.
- Check Eligibility: Begin by assessing your eligibility for an education loan based on your financial and academic background.
- Expert Guidance: After submitting your details, a loan expert will assist you in understanding the next steps.
- Document Checklist: A tailored checklist will be provided, outlining required documents and possible alternatives for easier arrangement.
- Verification & Approval: Once documents are submitted, verification begins (7–15 days depending on the lender). Upon approval, an agreement letter will be issued for signing. Loan application progress can be tracked in real time.
- Loan Disbursement: After signing the agreement, initiate the disbursement process as per the lender’s procedure. Some lenders transfer funds to your account, while others disburse directly to the university.
Loan Sanction & Pre-Visa Disbursement Process
Once the loan is sanctioned, the applicant receives a loan agreement detailing terms and conditions. Reviewing the document carefully is essential before proceeding with disbursement.
For a Canadian visa, a pre-visa loan disbursement is required as per the guidelines set by Canada Immigration Authorities.
Repayment of Abroad Education Loan for Canada?
When choosing an education loan for Canada, consider key repayment factors like interest rates, tenure, and moratorium options. Lenders offer various repayment plans, including Partial Simple Interest (PSI), Simple Interest (SI), and Equated Monthly Installments (EMI).
| Lender Name | Repayment Tenure | Repayment Option during Moratorium |
|---|---|---|
| SBI | Up to 15 years | No payment or only SI |
| UBI | Up to 15 years | No payment or SI |
| Axis Bank | Up to 15 Years | SI or EMI |
| ICICI Bank | Up to 10 Years | SI or EMI |
| IDFC FIRST Bank | Up to 12 Years | PSI or SI or EMI |
| HDFC Credila | Up to 15 Years | PSI |
| Auxilo | Up to 15 Years | SI |
| Incred | Up to 15 Years | PSI or SI |
| Avanse | Up to 15 Years | PSI or SI |
| MPOWER Finance | Up to 15 Years | SI |
| Prodigy Finance | Up to 15 Years | SI |
Frequently Asked Questions
Yes, a PG Diploma from Canada is highly valuable. With excellent educational institutions, practical training, and international recognition, it enhances job prospects and opens doors to global career opportunities.
A PG Diploma is a specialized postgraduate qualification obtained after completing a Bachelor’s degree, providing focused knowledge and practical training in a specific field. It enhances job prospects by equipping students with specialized skills.
Yes, you can get an education loan for Canada even if you are NRI. The main concept would be sharing the power of attorney with someone related to you that is in India that can complete the process on your behalf.
Yes, you can get UG Diploma education loan for Canada. You can get up to 50 Lakh INR if you are eligible as per lender requirements.
Applicants for a Canada student visa must demonstrate a minimum bank balance of 10,000 CAD.
Education Loan for USA
In order to apply for i20 you need to furnish bank balance proof of the last 24 hours / 1 day. However, if you have an Education Loan sanction letter, you do not show this balance for 24 hours.
Hence you can straight away apply for i20 & speed up the VISA process. Both – Secured & Unsecured – loans are accepted for higher studies in the USA.
Pursue Your Dream Degree in USA
The USA is a top study destination for international students, offering prestigious universities and a wealth of opportunities. In the 2021/2022 academic year, over 199,000 Indian students chose the USA for higher education, reflecting its immense popularity.
One key reason for this preference is the global career prospects available after earning a degree. Tuition fees vary across programs, with international graduate students paying an average of USD 39,000 annually. Education loans are an ideal solution to cover tuition, living costs, and other expenses. Moreover, these loans also serve as valid proof of funds for US student visas, simplifying the application process.
Education Loan Eligibility for USA
To obtain an abroad education loan in USA as an international student, there are specific conditions/eligibility criteria that need to be fulfilled.
These consist of:
Good academic record.
Collateral for secured loans.
Co-applicant with sufficient income for unsecured loans.
Acceptance into a recognized American institution for a full-time program.
Documents Required for Education Loan USA
Apart from meeting the eligibility criteria, students must ensure they have all the necessary documents ready before applying for an education loan to study in the USA. The document checklist can be extensive, but a personalized checklist can help streamline the process and speed up submission.
Commonly required documents for securing a study abroad loan for the USA include:
Loan application form
Passport-size photographs
KYC documents of the applicant
Standardized test scores (GMAT or GRE)
Academic transcripts (School and Bachelor’s)
Frequently Asked Questions
Candidates can get a UBI education loan without an account, even if parents are deceased, with simple EMI calculations and no prepayment fees.
To secure an education loan for the USA, you need an acceptance letter from a U.S. institution and a valid student visa. Most lenders require a cosigner who is a U.S. permanent resident with good credit and at least two years of residency.
Interest rates are based on benchmarks like the Prime Rate or SOFR, plus a margin determined by the borrower’s or cosigner’s creditworthiness.
Repayment options include full deferral, interest-only payments during studies, or immediate repayment. Terms typically range from 10 to 15 years.
Yes, unsecured loans are available and rely on creditworthiness. These may require a cosigner or a third-party guarantor.
Loans in the USA have interest rates between 8% and 19%, while home country loans often have rates around 10.25%, potentially making them a more cost-effective option.
Frequently Asked Questions
Candidates can get a Canada education loan without an account, even if parents are deceased, with simple EMI calculations and no prepayment fees.
To secure an education loan for the USA, you need an acceptance letter from a U.S. institution and a valid student visa. Most lenders require a cosigner who is a U.S. permanent resident with good credit and at least two years of residency.
Interest rates are based on benchmarks like the Prime Rate or SOFR, plus a margin determined by the borrower’s or cosigner’s creditworthiness.
Repayment options include full deferral, interest-only payments during studies, or immediate repayment. Terms typically range from 10 to 15 years.
Yes, unsecured loans are available and rely on creditworthiness. These may require a cosigner or a third-party guarantor.
Loans in the USA have interest rates between 8% and 19%, while home country loans often have rates around 10.25%, potentially making them a more cost-effective option.