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.
| 📝 Your Complete Guide to IDFC Bank Study Abroad Loan |
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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 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
In addition, the education loan also covers:
An IDFC Study Abroad Loan can help make studying overseas easier but make sure you meet all the requirements before applying.
To be eligible to apply for the education loan, the student must also meet the following requirements:²
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:
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
The IDFC Study Abroad Loan is transparent about the fees associated with the loan, and there are no hidden charges:⁷
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.
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
| Loan Amount | Spread | Interest rate to expect |
|---|---|---|
| 6.25% | 2.75% to 8.75% | 9% to 15% |
Rates retrieved on May 29, 2023.
Please verify the latest rates from the IDFC First Bank website.
| 💸 Income Tax Benefit |
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| You can deduct interest payments from taxable income tax under Section 80E of the Income Tax Act.⁸ This benefit is available on actual repayments without a ceiling on the amount for the deduction. The student's parents can claim this deduction if they are listed as co-applicants on the loan. |
IDFC First Bank offers flexible repayment options for your convenience:⁶
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.
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.
Here are the documents you will need to complete and submit with your IDFC Study Abroad Loan application:⁷
Please note you may be asked for additional documents by the bank officials to support your application.
Here are the steps to applying for the loan online:
Head to the nearest IDFC First Bank branch⁹ with all your documents. A branch official will help you through the loan application procedure.
| 📞 IDFC Bank Contact Information | |
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Here are a few ways to reach out to the bank:
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IDFC First Bank disburses the tuition fees directly to the university, and the living expenses can be credited to your overseas account.
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.
Please see the Terms and Conditions for your region and visit our pricing page for the most up-to-date pricing and fee information on Wise products.
Sources used for this article:
Sources verified on May 29, 2023.
Cover photo by Drahomír Posteby-Mach on Unsplash.
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This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.
We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.
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