A Non-Banking Financial Company (NBFC) is a financial institution other than banks that offers various types of loans, including education loans. New age NBFCs are gaining popularity among students due to several reasons. By screening the academic profile of the students before offering the study loans, NBFCs have successfully managed to redefine the norms of lending student loans. Let us take a look into the details of how new-age NBFCs are playing a major role in helping students grab the best of educational opportunities:

  1. NBFC education loan without collateral and with collateral
    NBFCs offer an education loan without collateral (unsecured loan) as well as with collateral (secured loan) to students who aspire to study in India or abroad. This is one of the biggest benefits of applying for a student loan from NBFCs, as most financial institutions will make it mandatory for you to provide collateral as security if you want to borrow a loan amount of a specific amount as prescribed by the lender. However, if you opt for an NBFC education loan without collateral, you can even get a higher loan amount, provided you meet the criteria. With a larger amount, you can aim to study at one of the top universities in the world without having to worry about finances. Secondly, an education loan without collateral and with collateral is available for study programs in India and abroad as well.
  2. Which expenses are covered?
    Some lenders offer student loans that cover only specific expenses. For instance, the education loans offered by most lenders are only restricted to academics. However, popular NBFCs will cover major educational costs beyond your tuition fees. This means the NBFC education loan will cover both academic expenses as well as other costs related to your higher education. For instance, at Avanse Financial Services, we offer education loans that cover the holistic cost of education, including these expenses:
    • Tuition fees
    • Accommodation costs
    • Travel expenses (airfare for study abroad students is included too)
    • Living expenses
    • Study material expenses
    • Cost of learning devices and other education-related expenses.
  3. What to do if you want to find the best education loan in India?
    One of the common mistakes that students often make when they shortlist their student loans is that they go for the financer that offers a low-interest rate. However, you have to consider the following aspects when you are looking for an education loan:
    • Costs covered
    • Benefits provided by the lender
    • Customer service
    • Customer rating
    • Testimonials
    • Education loan amount limit and more
  4. Margin money
    For those unfamiliar with margin money, this is your contribution toward the total cost of education. Most financial institutions expect you to pay some fraction of the total expenditure. For instance: Let's say your total cost of education is 60 lacs. If you contribute 5 lacs, the lender will provide the loan amount of 55 lacs. However, most new-age NBFCs will require no margin money.

    Pro Tip: One of the features of the best education loan in India is that the lender will not require you to run from pillar to post to arrange for margin money.
  5. Flexible repayment options
    Once students complete their graduation, they might not find a high-paying job the next day. NBFCs understand this and hence provide flexible repayment options. You can opt for a short or long tenure based on your preference. You can also opt for step-up EMIs. With step-up EMIs, your monthly instalments will start in small amounts and gradually increase as the tenure progresses. This helps you stabilise your finances while paying your education loan. So, these are some of the best features of NBFCs, which is why so many students prefer them when it comes to applying for education loans. So, if you are ever in need of a good education loan plan, feel free to get in touch with us at Avanse Financial Services. We offer customisable education loans with flexible repayment options. Do get in touch if you ever need any assistance. All the best!

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