Education Loan to Study in Australia - Complete Guide

International students willing to study in Australia can avail themselves of financial aid such as an education loan for Australia to bear the tuition fees and living expenses for the duration of their studies. This is because the cost of pursuing higher education in Australia might be on the higher side for a majority of the international students. 

International students can choose from over 22,000 courses across 1,100 institutions in Australia with innovation, creativity, and independent thinking deeply embedded in the core syllabus of higher education in Australia. The average cost of pursuing higher education in Australia ranges between AUD $34,000- AUD $40,000 for different courses.

The overall cost of studying in the country majorly depends on the program costs and standard of living of the student. More details about an education loan for Australia along with the application process, documents required, and expenses covered are discussed.

Table of Contents

• Eligibility Criteria for Education Loan for Australia
• Documents Required to Apply for Education Loan for Australia
• How to Apply for an Education Loan for Australia?
  
• Cost of Studying in Australia for International Students
  
• Expenses Covered under the Education Loan for Australia
  
  • Repayment of Education Loan for Australia
    
• Educational Loan Providers to Study in Australia 
  
• Top Indian Banks Offering Education Loan for Australia
  
• Which Intake to Opt for an Education Loan for Australia?
  
• Australia Education Loan Timeline
  
• Australian Embassy Funding Requirements for Indian Students
  
• Key Factors to Consider while Applying for an Education Loan for Australia

Eligibility Criteria for Education Loan for Australia

International students who have secured admission to the Australian universities of their choice should be focused on arranging the funds required for their educational expenses. The cost of pursuing studies in Australia is at par with other top countries such as the US and the UK and is expensive as compared to education in India. Many banking and non-banking institutions in India offer education loans to students interested in pursuing higher education in Australia. Given below are the basic eligibility criteria to apply for an education loan for Australia:

• The applicant should be an Indian citizen
• He/ she should have obtained admission in a recognized Australian university
• The student should be enrolled in a course that has been recognized by the funding institution (job oriented professional degree, technical degree, and diploma courses)

Documents Required to Apply for Education Loan for Australia

Several nationalized banks in India such as the State Bank of India provide education loans of up to Rs. 30 Lakhs to deserving students willing to pursue higher studies in Australia. Students will have to provide supporting documents for the bank to be able to process the loan amount. Listed below are the important documents needed to apply for an education loan for Australia:

• Admission letter from the chosen Australian university
• Completed loan application form
• Documents related to the total cost of studies
• ID proof
• Residence proof
• PAN details of the applicant
• Bank statement of the student/ co-borrower/ guarantor
• Statement of asset of the student/ co-borrower/ guarantor
• Income proof of the student/ co-borrower/ guarantor

How to Apply for an Education Loan for Australia?

Students willing to pursue education in Australia can avail themselves of education loans from Indian Nationalised Banks (Private and Govt.) or Non-Banking Financial Banking Corporations (NBFCs). Students should closely coordinate with visa offices, international admission offices, and bank authorities for a smooth application process. The detailed application process for an education loan for Australia is as follows:

• The applicant should first choose a banking institution to get an education loan for Australia
• He/ she should apply for the education loan by providing initial KYC documents, collateral documents, and academic records
• The student should also get an electronic Confirmation of Enrolment (eCoE) from the respective Australian university
• The candidate should get a student visa application confirmation from the Australian embassy in India
• The next step is to get a Loan Sanction Letter along with a signed agreement by submitting the required documents to the banking institution
• The applicant should submit the Loan Sanction Letter to the Embassy and complete other processes to get the Australian Student Visa
• He/ she should then submit the Australian Student Visa confirmation to the university to confirm the intake session details and fee payment schedule. These details should finally be shared with the bank to start loan disbursement

Cost of Studying in Australia for International Students

In this section we will understand the tuition costs of different levels of studies in Australia. Below is a table that shows the average tuition fees for various degrees in Australia for international students:

Australian Degree Level	Average Tuition Fees
English Language Study	AUD 390/week
VET (Vocational Education)	AUD 5,200 – AUD 28,500
UG Degree	AUD 19,400 – AUD 42,700
PG Degree	AUD 26,000 – AUD 48,000
Doctoral Degree	AUD 18,000 – AUD 48,000

Expenses Covered under the Education Loan for Australia

An education loan for Australia sanctioned by an educational institution can be solely used for educational purposes and does not cover personal expenses. Some of the expenses covered under the education loan for Australia for Indian students include:

• Tuition fees
• Accommodation charges
• Caution deposit
• Travel expenses
• Costs incurred for project work and study tours for the academic year
• Books, stationery, and laptop costs
• Other reasonable course-related expenses 

Repayment of Education Loan for Australia

The loan amount ranging between INR 4-7.5 lakhs should be repaid in full within 10 years. Students who have taken an education loan above 7.5 lakhs are given 20 years to repay the entire amount. The time given for repayment of the education loan for Australia varies for different loan-providing institutions.

Educational Loan Providers to Study in Australia

For a one-year course at an Australia university, an Indian student is charged on average INR 20-35 Lakhs. Therefore, those who cannot pay the entire sum at once must apply for a study loan. The following options can be used to obtain an education loan for Australia:

• Indian Nationalised Banks
• Private Banks
• NBFC or Non-Bank Financial Companies

Indian Nationalised Banks

These banks generally provide 90% to 100% secured educational loans in terms of collateral to Indian students. The advantages of using a nationalized bank include their lower interest rates, lower processing charges, and no extra charges for interest rates. Application processing may take longer in such cases and follow-up may be delayed. Take a look at the requirements of Bank of Baroda for offering loans to Indian students for studying in Australia.

Bank of Baroda:

The bank provides 100% loans to students who are accepted by Go8 Australian Universities, namely:

•  Monash University
•  University of New South Wales
•  University of Queensland
•  University of Melbourne
•  University of Sydney
•  Australian National University
•  University of Western Australia
•  University of Adelaide

Eligibility Requirements for Bank of Baroda Loan:

In order to apply for a loan with Bank of Baroda, you must fulfill the following requirements:

• Applicant’s profile should have a minimum set of KT's or no KT's.
• Anyone who will be a co-signatory must have a CIBIL score of at least 650.
• It is essential that the co-signer also has enough disposable income to pay the interest on the loan.
• Additionally, the property should be mortgageable, unhibited, and should have proper documentation.

Private Banks

Compared to nationalised banks in India, the process of obtaining a loan through private banks is faster. Follow-ups are better and you are assigned a dedicated relationship manager.However, private banks generally charge higher processing fees, higher interest rates, and typically offer unsecured loans. A student or applicant who takes out an unsecured loan does not have to mortgage or submit any assets as collateral. Private banks such as Axis Bank and ICICI Bank provide students admitted to Australian universities with unsecured loans.

Axis Bank: Student who have been admitted to universities like Curtin University, James Cook University, La Trobe University, RMIT University, etc., can obtain unsecured education loans through Axis Bank.

ICICI Bank: Students who have been admitted to universities like University of Melbourne, University of Adelaide, University of Queensland, can apply for ICICI bank loan.

NBFC or Non-Bank Financial Companies

Thirdly, students can apply for educational loans from NBFCs for studies in Australia. There are several NBFCs, including HDFC Bank Credila, Auxilo, and others, which provide loans to students on the basis of final confirmation from the Australian High Commission. This makes tuition fee disbursement easier because direct sanctions are received from the financial institutions handling this, and they reflect in the bank account as well.

Top Indian Banks Offering Education Loan for Australia

An education loan for Australia is provided by Indian Banks, NBFCs, and Private Education Loan Experts. Top Indian banks provide loans with an interest rate of 7%-18% to students interested in pursuing studies in Australia. Some of the top banks in India offering education loan to study in Australia along with the maximum loan amount are shown below:

Bank Name	Maximum Loan Amount (in INR)
Union Bank of India	15 Lakhs
Allahabad Bank	20 Lakhs
Punjab National Bank	20 Lakhs
Indian Bank	20 Lakhs
Dena Bank	20 Lakhs
State Bank of India	20 Lakhs
Bank of Maharashtra	20 Lakhs

Which Intake to Opt for an Education Loan for Australia?

Students can choose the right intake by considering various factors like availability of the desired program, student’s academic records,  entrance tests scores, employment opportunities, and student’s readiness to join the course. 

Education loans for Australia are only available from certain banks. Identifying which banks offer education loans for Australia is the first step. The list is available on the government website india.embassy.gov.au . It is recommended that you start planning your finances at least three months before joining the program, as the entire visa process is dependent on the approval of the education loan.

Australia Education Loan Timeline

In general, it is advised that students arrange for funding immediately upon receiving their acceptance letters from universities. Indian government banks usually require 40-60 days to process an education loan after the relevant documents are submitted. 

Generally, the Australian Embassy prefers applicants with secured education loans for student visas. For secured loans, students must submit a number of collateral documents. Hence, students might require sufficient time to arrange for certain documents. The following steps will help you understand how much time it will take for a bank to lend your abroad education loan:

• Applicating for an education loan and arranging for the necessary documents: 1-2 weeks.
• Creation of mortgages: This typically takes 2-3 working days, following which the loan money will be disbursed to candidates.
• After mortgage creation, the candidate will receive the loan amount based on their preferences.

Thus, students must apply for an education loan for Australia at least 1.5 months prior to the actual date when they need funds to be disbursed.  

Australian Embassy Funding Requirements for Indian Students

Students are required to deposit their funds in a particular way by the Australian embassy. Prior to the loan amount being disbursed by banks, students must provide the details of the bank account to which tuition fees and health insurance funds are to be transferred.

After the funds have been disbursed from the lending bank, what happens next?

• After successful funds transfer from the bank to the university, students need to submit the payment receipt to the university.
• Upon receiving the receipt, the university issues a Certificate of Enrolment, which is required for an Australian student visa.
• The living expenses for a student will be transferred to an Indian savings account, with a ‘Hold’.
• While this transaction will appear in the student's savings account, transactions cannot be performed by the student until he or she begins the course.

Key Factors to Consider while Applying for an Education Loan for Australia

Most of the education loan providers cover the cost of living in Australia for Indian students along with their academic expenses. The Australian student visa application process is directly linked to the financial ability of the applicant. So, it is highly necessary for Indian students to get a loan, international scholarship, or personal funding to study in Australia. Some of the key factors to remember while applying for an education loan for Australia are listed below:

• One should always check if the education loan provider covers the medical insurance (OSHC Australia) expenses or not
• The applicant should confirm if the education loan service is scholarship adjustable
• One should check if the loan is still applicable if the student gets a PR-Visa in Australia
• The interest rates and Indian government education loan subsidy norms for overseas education needs to be checked