Pursuing a Doctor of Philosophy or PhD is a great decision as it ensures career development. PhD is the highest academic qualification that offers expert knowledge in the chosen subject and broadens career opportunities.
Although PhD students get monthly payments to cover their expenses, it is not equivalent to the salary. Hence, studying PhD can be financially challenging due to the long duration of the course. Therefore, many students apply for an education loan for PhD programs to finance their higher education independently. So, whether you are planning to pursue a PhD from India or any study abroad destination, this guide will help you by providing important information about education loans for a PhD.  

Key Highlights

• Benefits of an education loan for PhD
• Types of student loans for a doctorate degree
• Education loan for PhD students: eligibility criteria
• Documents required to apply for an education loan for PhD abroad and in India
• Application process
• PhD student loan repayment method

Benefits of an education loan for PhD

• An education loan allows you to access quality education by covering education-related expenses such as tuition fees, accommodation costs, etc.
• It eliminates the need to use your family’s savings.
• You can earn a self-made badge by financing your higher education independently.
• A loan for education will be your first debt. Therefore, responsibly repaying helps in building a good credit score.

Types of student loans for a doctorate degree
Generally, financial institutions offer two kinds of education loans for a PhD degree based on collateral: secured and unsecured loans.

• Secured loan: When a borrower pledges an asset as collateral, it is termed a secured education loan.
• Unsecured loan: A borrower does not pledge any asset as collateral in an unsecured loan.
• Collateral: Collateral acts as a security to recover the loan if the borrower fails to repay. Some assets accepted as collateral are residential property and non-agricultural land.

Education loan for PhD students: eligibility criteria
A borrower needs to meet the following criteria:

• Must be an Indian citizen 18 years or older
• Must have a confirmed admission before the final loan disbursal
• Must have a co-borrower, who earns in India

Most financial institutions will ask for a co-borrower or co-applicant to process the application for an education loan for a PhD. A co-borrower also needs to meet the following criteria:

• Must be an Indian citizen and a legal guardian, parent, sibling or other blood relative
• Must have a bank account in India that allows them to sign cheques
• Must be the primary debtor

Documents required to apply for an education loan for PhD abroad and in India
A borrower needs to submit the following documents:

• Academic documents
• Proof of admission
• Fee structure
• Photo ID proof
• 2 colour passport-sized photos
• Residence proof like Electricity Bill
• Date of Birth proof
• Document to verify the signature

A co-applicant needs to submit the following documents:

• Photo ID proof
• 2 colour passport-sized photos
• Residence proof
• Date of Birth proof
• Document to verify the signature
• Income proof such as salary slips, income-tax returns, etc.
• Collateral documents, in case of a secured loan

It is advised to speak to your lender and understand their specific criteria before applying for the loan.

Application process
Fill out a student loan application form with the correct information and attach necessary documents like Student’s Know-Your-Customer (KYC), Co-borrower’s KYC and other important documents as mentioned above. Feel free to submit the form either online or by visiting the financier’s office.

PhD student loan repayment method

You can easily pay PhD student loan in the following manner:

• Equated Monthly Instalments (EMIs): EMIs are the most popular way of paying student loans in which a borrower has to pay fixed amounts every month. EMI combines both the principal amount and the education loan rate of interest.
• Interest servicing during the course: Borrowers are allowed to pay simple or partial interest during the moratorium period. Kindly remember that the moratorium period in an education loan is a grace period but not an interest-free period. Hence, the interest keeps accruing and will increase the overall repayment cost of the student loan.

At Avanse Financial Services, we encourage our students to make small payments in the form of partial or simple interest during the moratorium period to repay the loan faster. 
When you choose Avanse Financial Services to avail of a hyper-personalised education loan for study abroad purposes or for pursuing higher studies in India, you will experience multiple benefits. We offer 100% finance to students, flexible repayment options and quick sanctions. So, connect with us today to know more!