The Role of NBFCs in Providing Engineering Education Loans
Overview
Although public sector banks have historically been the go-to option for student loans, Non-Banking Financial Companies (NBFCs) are gaining traction, particularly among students who want flexible terms and faster processing. NBFCs are providing engineering education loans to a growing number of students across India.
Why Opt for NBFCs?
When it comes to loans for engineering education, NBFCs have a number of advantages over traditional banks:
Quicker Processing: When students have strict deadlines for college admissions, several NBFCs expedite the processing of loan applications.
Flexible Eligibility Criteria: NBFCs may take into account more general aspects like employability and course repute, in contrast to banks that mostly rely on strict regulations.
No Loan Amount Cap: Certain NBFCs provide larger loan amounts, particularly for costly private schools or overseas education. Loan Features Provided by NBFCs NBFCs that offer specialized engineering education loan packages include HDFC Credila, Avanse, and InCred.
Typical traits include:
Collateral-free loans of up to ₹20–25 lakhs, contingent on the institution and course
Competitive interest rates, but frequently marginally greater than those offered by banks
Choices for paying interest in full or in part during the moratorium
Customized grace periods and repayment schedules
Considerations Prior to Selecting an NBFC Although NBFCs provide greater flexibility, they could also have slightly higher interest rates and processing expenses. It's crucial to:
Examine interest rates offered by both governmental and private institutions.
Recognize the entire fee schedule. Examine the NBFC's standing and track record of providing excellent customer service.
Make sure the loan pays for living expenses, tuition, and extra costs like exam or insurance fees.
In conclusion
For students in need of an engineering education loan, NBFCs have become a formidable substitute for banks. They are especially beneficial for students with non-traditional profiles or immediate financial needs because they offer quicker service and more flexible options. Before making a choice, nevertheless, a thorough comparison and comprehension of the loan terms are necessary.