Overseas education is now a middle class dream too

21 May, 2016

Seema Wadhwa says the advent of student loans in India has converted the overseas education dream limited to the few gifted ones to now a possible reality for many.

Two decades ago if a student was on his way to a foreign university for further studies, there were two crystal clear assumptions about him/her; either he/she is born with a silver spoon or must be an academic genius to secure a seat through scholarship. Today, exactly 20 years later, the overseas education dream doesn't alone belong to those with a strong balance sheet or those with a Midas touch for academics.

The advent of student loans in India has converted the overseas education dream limited to the few gifted ones to now a possible reality for many.

So what's the tango to this ticket for a student's dream university? The grades are of course pivotal but how does the moolah arrangement through student loans work? We spoke to Mumbai based Education Consultant, Karan Gupta to find out.

Gupta said, "Several private and state banks and private lenders offer education loans for students who wish to study lead 1abroad. The maximum amount offered by State banks is Rs.30 lakhs with a repayment period of 15 years. The interest rates charged by state banks are currently at around 11.5%."

He further added, "For almost all loans amounting above Rs.7.5 lakhs, one needs to provide security of around 100-115% of the loan amount. Private lenders such as HDFC Credila and Avanse may offer loans of up to the entire amount of tuition and living expenses. However, such loans have a higher interest rate of around 13-14%. And in almost all cases, collateral security to get the loan must be given. Obtaining loans is not difficult as long as you have the collateral security in place. The procedure is simple - apply to the bank with your admission and financial papers and the loans are approved within 7-14 days."

Given the number of courses available across the globe today, our next question was whether the lending services have a special preference for certain courses or does the choice of region (where the student wants to pursue further studies) have any impact on the loans?

Gupta responded that the choice of region/institute doesn't matter to banks as long as the applicant's university preference is recognised as an accredited institute.

So that clears the air about the monetary aspect, next comes the most important question encompassing the procedure for seeking an admission. Though most applicants hire a counselor, some students manage to complete the procedure independently.

A student from University of Florida on the grounds of anonymity shared his admission experience without extending the assistance of a counselor.

He told us that while not hiring a counselor helps one save the rocketing counselor fees these days, a student needs to invest a lot of time to research extensively in order to be on the right lead 2track. As per his experience, most university offices' staff was friendly and helpful, but an applicant needs to check the universities' websites to understand the relevant contact person at every given stage, since Indian students are not aware of the terms used for the processing officers from the staff, it could get taxing.

Our obvious question was, should one completely do away with a counselor? He said, "It all boils down to personal choice, while it is possible to independently complete the procedure and seek admission; having a counselor smoothens the entire process. But at the same time, one needs to be wise when choosing a counselor as things could even go haywire in worst cases."

And finally, in a situation where the student is hoping to study abroad on a scholarship, what is the probability? We spoke to Siddhali Doshi, a post graduate applicant in the field of fashion. Sharing her experience, she said that the Indian Government does not support a relatively niche field like fashion studies when it comes to a scholarship. While there are fair number of scholarship opportunities for management, engineering and medicine; they still lack in a field like fashion.

Sharing her experience of application process in the UK, she further added, "The UK Government offers 20-25% scholarship to quite a few students on the basis of assignments, merit and financial standing. Even a 20-25% margin of scholarship somewhat helps relax the pocket. They also offer limited 100% scholarship opportunities to students on the same grounds. The quality of assignments and merit carry more weightage than the financial situation when the scholarships are issued."

In a time when student loans are accessible, the internet is flooded with information for students to independently kick start the application process and scholarships, not in abundance but more than before are offered; the overseas education dream is now a middle class dream too.