Education Loan for Study in India & Abroad – Complete Guide (2026)
In India, rising education costs often force students and parents to choose between dreams and finances. Whether it’s a top university in India or a reputed institution abroad, an education loan helps bridge this gap. In this 2026 guide, we break down everything Indian students need to know—eligibility, interest rates, collateral, documentation, repayment, and how to choose the right lender without risking rejection.
What Is an Education Loan?
An education loan is a financial product designed to cover expenses related to higher studies. It can be used for:
- Tuition fees
- Hostel and living expenses
- Books, laptop, and study material
- Travel expenses (for overseas education)
- Exam, library, and insurance fees
Education Loan for Higher Studies in India
Education loans for Indian institutions are generally easier to obtain and come with lower interest rates.
In our experience, many students assume education loans in India are automatically approved. However, lender selection, institute recognition, and co-applicant income play a major role in approval.
Courses Covered
- Graduation & Post-Graduation (UG/PG)
- Professional courses (Engineering, Medical, MBA, Law, CA, etc.)
- Diploma & vocational courses (approved institutes)
Key Features
- Loan amount: Up to ₹10–50 lakhs (varies by lender)
- Interest rates: Lower compared to overseas loans
- Collateral: Required for higher loan amounts
- Moratorium: Course duration + 6–12 months
Education Loan for Overseas Education
Studying abroad involves higher expenses, making education loans for overseas studies extremely important.
Countries Covered
- USA
- Canada
- UK
- Australia
- Europe & other approved countries
Expenses Covered
- Tuition fees
- Living expenses
- Airfare & travel
- Health insurance
- Visa & exam fees
Key Features
- Loan amount: Up to ₹1 crore (depending on profile)
- Collateral or non-collateral options available
- Higher interest rates than domestic loans
We often see overseas education loan rejections not because of low marks, but due to incorrect lender choice or incomplete documentation—something students usually realize too late.
Education Loan Eligibility Criteria
Eligibility depends on the student’s academic profile and financial background.
Student Eligibility
- Indian citizen
- Confirmed admission to a recognized institution
- Good academic record
Co-Applicant Eligibility
- Parent, guardian, or spouse
- Stable income source
- Good credit history
Documents Required for Education Loan
1. Student Documents
- Admission letter
- Academic certificates & mark sheets
- KYC documents (Aadhar, PAN, passport)
2. Co-Applicant Documents
- Income proof (salary slips / ITR)
- Bank statements
- Identity & address proof
3. Collateral Documents (If Applicable)
- Property papers
- Valuation & legal reports
Education Loan Interest Rates (2026)
Interest rates vary based on lender type:
- Public Banks: Lower interest, strict eligibility
- Private Banks: Faster processing, moderate rates
- NBFCs: Flexible eligibility, higher rates
Rates generally range between 8% to 14% per annum depending on profile and loan type.
Collateral vs Non-Collateral Education Loans
1. Collateral Education Loan
- Required for higher loan amounts
- Property, FD, or insurance accepted
- Lower interest rates
2. Non-Collateral Education Loan
- No asset required
- Based on student profile & institute
- Slightly higher interest rates
👉 Education Loan Without Collateral – Complete Guide
Repayment, EMI & Tax Benefits
1. Repayment Structure
- Moratorium during study period
- EMI starts after course completion
- Flexible repayment tenure (up to 15 years)
2. Tax Benefits
- Interest paid qualifies for tax deduction under Section 80E of the Income Tax Act
Common Reasons for Education Loan Rejection
- Weak academic profile
- Low co-applicant income
- Poor credit score
- Unrecognized institution
Most rejections happen at the application stage itself. Proper profile evaluation before applying can significantly improve approval chances and protect your credit score.
How MudraX Helps You Get the Right Education Loan
At MudraX Capital, we work closely with students and parents to match each profile with the right lender—reducing rejection risk and saving time. From domestic education loans to high-value overseas loans, our team handles documentation, lender coordination, and approval follow-ups end-to-end.
Having handled diverse student profiles across India, we understand how lender policies differ—and use this insight to improve approval chances.
📍 Based in Noida, serving students across India
👉 Apply for Education Loan with MudraX
Frequently Asked Questions (FAQs)
Q1. Can I get 100% education loan for my studies?
Yes, depending on the course, institute, and lender.
Q2. Is education loan interest-free in India?
No, but interest is subsidized in some government schemes.
Q3. Can I repay education loan early?
Yes, most lenders allow prepayment with minimal or no charges.
Conclusion:
An education loan is not just financial support—it’s an investment in your future. Whether you plan to study in India or abroad, choosing the right loan and guidance can save you money and stress.
📞 Looking for expert help? Contact MudraX Education Loan Experts today for personalized guidance.