IDFC First Bank Education Loan for Study Abroad: Complete Guide

IDFC First Bank, a private bank in India, offers education loans to help Indian students pay for studying overseas. One of the main benefits of the IDFC Study Abroad Loan is that it provides collateral-free education loans of up to INR 75 lakhs for qualifying applicants.¹ Learn more about the IDFC Study Abroad Loan, what’s required to apply, and how much it may cost.

Eligible Colleges and Covered Expenses for IDFC Study Abroad Loan

IDFC Study Abroad Loan is available for eligible Indian students who intend to complete a bachelor's, master's, or higher degree outside India. Here are some of the countries where the loan can be used for higher education:⁴

• The US
• United Kingdom
• Australia
• Canada
• New Zealand
• Singapore
• Germany

The loan may also cover additional countries, and the bank representative can provide you with the complete list of eligible countries.

You can apply for the IDFC Study Abroad Loan for a wide range of courses beyond post-secondary degrees, including technical and professional courses and vocational, diploma, and executive courses. You are not required to pursue a specific field, like STEM or engineering, to qualify.

The IDFC Study Abroad Loan covers all the major costs associated with going for higher education abroad- including college-related and living expenses. Here is a list of costs covered by the IDFC Study Abroad Loan:⁴

• All tuition fees.
• Examination, library, and laboratory fees.
• Cost of books, equipment, uniforms, and instruments as required by the course.
• Living expenses, including hostel fees.

In addition, the education loan also covers:

• One-way travel to the university.
• Health insurance for the student.
• Computer or laptop as required by the course.
• Overseas insurance for the student

Requirements to Apply for the IDFC Study Abroad Loan

An IDFC Study Abroad Loan can help make studying overseas easier but make sure you meet all the requirements before applying.

Student Eligibility: Who Can Apply

To be eligible to apply for the education loan, the student must also meet the following requirements:²

• Nationality: All Indian passport holders can apply for an IDFC Study Abroad Loan, including Non-Resident Indians (NRIs).
• Age: Students must be 18 or older when applying for an education loan.
• Qualifications: Graduation and diploma courses require the student to complete Standard XII (10 plus 2). In addition, the students should be graduates in the discipline to be eligible for post-graduation programs.
• Acceptance from the university: The student must have received confirmed admission to the program at the university overseas. A student may be able to apply for a loan sanction before their admission is confirmed, but that depends on various factors, such as the type of course, the institution, and the country for which the student has applied.

Collateral security for the loan

The most attractive feature of an IDFC Study Abroad Loan is that collateral may not be mandatory. With a qualifying application, the bank may lend up to INR 75 lakhs as an education loan without collateral. You will need to provide collateral security for any amount above that, and the loan is available for a maximum amount of INR 1 crore.⁷

Whether collateral is required or not depends on a few factors:

• The loan amount
• Type of college or university
• Applicant's credit profile.

In addition to these requirements, you must have a co-applicant included on the IDFC loan application. The co-applicant can be the student's parent, grandparent, in-laws, spouse, or siblings (over 18).⁷

Upfront Payment

The IDFC Study Abroad Loan is transparent about the fees associated with the loan, and there are no hidden charges:⁷

• Loan Processing Fee: IDFC First Bank charges a nominal processing fee of up to 1.5% of the loan amount. This fee needs to be paid upfront while applying for the loan.
• Margin: Generally, IDFC First Bank offers 100% financing to students pursuing higher education abroad, so a margin is not required. However, depending on the college or university, the bank may ask for a margin on a case-by-case basis.

Cancellation fee: IDFC First Bank has a loan cancellation charge of 1% of the loan amount plus interest. This is calculated based on the period from when the loan was disbursed to the date of cancellation.

Interest Rate for IDFC Study Abroad Loan

The interest rate on an IDFC Study Abroad Loan is based on the Reserve Bank of India's repo rate plus an additional amount set by the bank called the spread. The interest rate on the loan can depend on your credit profile, the loan amount, and the study abroad course:⁵

IDFC Study Abroad Loan Repayment Terms

IDFC First Bank offers flexible repayment options for your convenience:⁶

1. Immediate repayment: you have to start paying back the loan with monthly principal and interest payments immediately.
2. Simple interest: Borrowers can pay the interest amount alone during the college course period.
3. After the moratorium: the monthly repayments start after the college course plus additional 12 months.

IDFC First Bank offers a maximum loan tenure of 10 years after the moratorium for educational loans. There is no prepayment charge if you want to pay it back early.

However, make sure to make all payments on time, as missing a payment will result in a penalty fee of 2% of the unpaid amount per month with a minimum charge of INR 300.

How to apply for IDFC Study Abroad Loan

IDFC First Bank has a simple online application procedure for the Study Abroad Loan. You can also visit an IDFC bank branch to complete it in person. In both cases, ensure you have your documents ready - check out the section below for the paperwork you need.

Required Documentation

Here are the documents you will need to complete and submit with your IDFC Study Abroad Loan application:⁷

• KYC documents like ID and address proof for the student
• KYC documents like ID and address proof for the co-applicant
• Co-applicant income information.
• Photographs.
• Exam mark sheets from Standard X onwards
• Undergraduate mark sheet
• Postgraduate mark sheet
• Admission confirmation for the course abroad.

Please note you may be asked for additional documents by the bank officials to support your application.

Online Loan Application

Here are the steps to applying for the loan online:

1. Gather your documents and information.
2. Go to the IDFC First Bank education loan application page.
3. Fill in the required information, like name, date of birth, address, preferred country of study, and mobile number.
4. Receive the OTP and access the loan application page.
5. Complete the application procedure.
6. An IDFC bank official will contact you to complete the process.

Offline Loan Application - In person

Head to the nearest IDFC First Bank branch⁹ with all your documents. A branch official will help you through the loan application procedure.

IDFC Education Loan Disbursal Process

IDFC First Bank disburses the tuition fees directly to the university, and the living expenses can be credited to your overseas account.

Start your journey with Wise: the world’s most international account¹¹

Opening an overseas account is one of the first things you will need to figure out when you arrive abroad for your studies. Check out the Wise multi-currency account available for residents living in supported countries. Enjoy an account as worldly as you are and spend just like a local when you travel abroad with a linked debit card, while also paying less in fees.

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