Queries for overseas education loans surge as travel restrictions wane
The ticket size for an average overseas education loan has increased to Rs 35 lakh in FY 21 as compared to Rs 30 lakh in previous year
With various countries easing travel restrictions, the queries and demand for education loans have surged, Times Of India reported Monday. Schools and colleges are reopening globally and the students are resuming their plans for overseas studies, it added.
Financial institutions offering educational loans have seen a big spike in outbound student’ enquiries. During FY 21, lending rates have fallen by 50 basis points, with rates starting at 9.5% for applications to premier schools overseas. The growth is also due to the emergence of a pent-up demand, the report noted, adding that the ticket size for an average overseas education loan increased to Rs 35 lakh in FY 21 as compared to Rs 30 lakh in previous year.
Russia and Czech Republic witness growing interest
It was reported that HDFC Credila had a 209% rise in overseas education loan applications in the first quarter of FY 22 as compared to the first quarter of the previous year. US, Canada, UK and other European countries have been the top drivers for growth across geographies, it said.
According to the US embassy, over 55,000 Indian students and exchange visitors are travelling to study in the US this year, which is an all-time record. In 2021, UK had an increase of 19% in the number of students being accepted into universities and higher education courses through the country’s centralised application system, as compared to the previous year.
Credenc, a Fintech company, which has a book size of Rs 150 crore, reported that most of the traction came from students who wanted to pursue higher education in Singapore, EU, Ireland and the UK, as compared to the US. For the first time, the company is seeing a growing interest in Russia and Czech Republic. However, Germany, New Zealand and Australia are yet to communicate on the visa and travel guidelines for overseas students officially, it added.
India is seen as the fastest growing market by international education loan provider, Prodigy Finance, with a 60% increase in loans as of August this year. Its other key markets include China, Pakistan, Peru and Mexico. The publication reported that there is a 10-15% rise in the average ticket size of loans from Rs 30 lakhs, driven by a marginal increase in tuition fees.