Education Loan for Canada: The Complete Guide 2024

Canada is a popular destination among international students worldwide due to its excellent universities that provide a wide range of experiences and opportunities. However, pursuing higher education in Canada can be expensive. For the year 2022, there were more than 226,000 Indian students who went to Canada for education purposes. This figure makes it evident that the popularity of Canada as a study-abroad destination is growing among Indian Students. 

There are different programs in which a student can enroll themselves as per their need, including Bachelor's degrees and Master’s Degrees, Undergraduate and Postgraduate diplomas. The tuition fees for different programs and courses vary, but the average cost for international graduate students is around CAD 21,000 per year. In addition to tuition fees, you'll also need to budget for living expenses and all this can be expensive to manage. This is when you ask yourself can I get a loan to study in Canada? Let’s find out!

Cost to study in Canada

Before answering the question ‘Can I get a loan to study in Canada?’, you should be aware of the cost of studying in Canada. When considering the cost of education in Canada, it is important to understand that it consists of two main categories of expenses: tuition fees and the cost of living. These two areas encompass the major components of expenses that individuals need to take into account. Now depending on the program of choice the tuition fees can vary. Doing MS in Canada is a bit expensive when compared to doing a PGDM in Canada. An overview table is provided below that showcases the average tuition fees per year for different programs

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Now that you know the average tuition fees of different programs it is time to explore the cost of living for Canada. Now the cost of living depends on the province you live in but a general idea of living expenses is shown in the table below:

Education loan eligibility for Canada

To obtain Canada student loan, there are certain prerequisites that must be met.

• These include having a confirmation of acceptance from a recognized Canadian institution for a full-time program
• You should be at least 18 years old. 
• Must have a good academic record.
• Additionally, the chosen course of study should have strong career prospects in relation to non collateral education loan for Canada, and for secured loans, collateral must be provided.  

Expenses covered by education loan for Canada

It is up to you to either take the disbursement of the whole sanctioned loan amount in one go or you will be getting periodical disbursal as per your requirement. Later is preferred, to ensure that you do not end up taking out an additional amount as this will lead to an increased interest. The interest is charged on the disbursed amount not the sanctioned amount.

The expenses which may be covered under loan as per the lender will include -
 

Types of education loan for Canada

There are mainly two types of Canada education loan:

1. 
   Secured education loans: These loans need some valuable item as security.
2. 
   Unsecured education loans: These loans might require someone to co-sign with you for financial support.

Now, let's explore each type in more detail.

Secured education loan for Canada

A secured education loan requires borrowers to provide collateral as security during the application process. Collateral can include assets like property, fixed deposits (FDs), or insurance policies. This type of loan usually offers lower interest rates, longer repayment periods, and the potential for higher loan amounts. These loans are more accessible as lenders consider the collateral as a safeguard in case of default. Now, let's explore some financial institutions that provide secured education loans and their key features.

Unsecured education loan for Canada

In case you do not have collateral to pledge, you don’t have to worry because there are lenders like private banks, NBFCs, and international lenders that are available which can help you in this scenario. For private banks and NBFCs, you may need a co-applicant/co-signer with a minimum financial income without obligations, but in the case of international lenders, you can get a loan without a co-applicant and collateral.

In order to help you choose an effective lender for non collateral education loan for Canada we have discussed the loan offerings for private banks, NBFCs, and International lenders separately. This will help you to get a better idea. As per lender criteria, you can take a study loan for Canada for Bachelor’s Master’s, Undergraduate Diploma, or Postgraduate Diploma. 

Education loan for Canada from private banks

This section answers the question - how to get study loan in Canada from private banks? When it comes to private banks they can provide you with an education loan for Canada majorly for Master’s and PGDM programs. But in case your application profile is strong then Axis Bank and ICICI Bank can provide you with an education loan for Undergraduate Diploma and Bachelor’s degree. Detailed information on their loan offerings has been shown below:

Education loan for Canada from NBFC

NBFC has its own set of criteria to give education loans for study in Canada. They have different loan amounts for Canadian universities and Canadian Colleges. They provide education loans for all types of programs like Master’s, Bachelor’s, Undergraduate Diploma, and Postgraduate Diploma.

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Education loan for Canada from international lender

Now, when you do not have collateral or co-applicant then you can go for an international lender. The main requirement for this is that your target university should be on its approved list of schools. If you are also looking for the answer to the question  of how to get loan for study in Canada without collateral and co-applicant have a look at the table below: The loan offerings by them are shown below:

Documents required for education loan in Canada

In addition to the prior mentioned eligibility requirements, it is imperative for students to verify that they possess all the necessary documents before obtaining Canada student loan. The document list can be exhaustive and that is why GyanDhan also provides you with a customized document checklist that can help you fasten the document submission process. Some general documents which will be required to get a study abroad loan for Canada are - 

• Applicant’s KYC documents.
• Proof of admission: admission letter from university/institution
• Fees structure from the university 
• Loan application form
• Passport-size photographs
• Income proof of the co-applicant (for non collateral education loan for Canada)
• Academic transcripts (School and Bachelor’s).
• Standardized test scores - GMAT or GRE
• English proficiency test score - IELTS or TOEFL or Duolingo. 
• Resident proof of the applicant and co-applicant
• Property papers (in case of secured education loan)  

*The GIC is an investment scheme with fixed returns to eligible candidates. It can act as a savings account and has benefits like no processing fee when paying with foreign currency, credit card facilities, etc. GIC can help you with quick visa processing.
**The SDS is an expedited study permit processing program through which the applicants get study permits faster.

How to choose the best educational loan option?

Having explored various loan for students in Canada, you are now equipped to make an informed decision. However, the abundance of choices can be overwhelming. To determine the best lender for your needs, it is essential to consider the following factors for comparison:

• Interest Rate
• Processing fee and time
• Margin Money
• Moratorium Period
• Tax Benefit
• Loan Duration
• Covered Expenses
• Prepayment terms and conditions  

By carefully evaluating these factors, you can select the best educational loan option that aligns with your needs and offers favorable terms and conditions.

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Repayment of education loan for Canada

Repayment is a factor that you should consider while taking a loan for a student in Canada with any lender. In repayment as well, 2 things need to be considered while making a choice of lender that is the repayment tenure and the moratorium repayment options. There are different types of repayment tenure available like partial simple interest (PSI), simple interest (SI), and EMI. A comparative guide has been provided, specifically focusing on repayment as a considerable factor for taking a loan to study in Canada.

Lender name	Repayment tenure	Repayment option during moratorium
SBI	Up to 15 years	No payment or only SI
UBI	Up to 15 years	No payment or SI
Axis Bank	Up to 15 Years	SI or EMI
ICICI Bank	Up to 10 Years	SI or EMI
IDFC FIRST Bank	Up to 12 years	PSI or SI or EMI
HDFC Credila	Up to 15 Years	PSI
Auxilo	Up to 15 Years	SI
Incred	Up to 15 Years	PSI or SI
Avanse	Up to 15 Years	PSI or SI
MPOWER Finance	Up to 10 Years	SI
Prodigy Finance	Up to 15 Years	SI

How to get study loan for Canada?

Obtaining an education loan for Canada is an easy process. However, managing multiple lenders individually can be challenging, which is why GyanDhan offers assistance in obtaining an education loan for studying in Canada through the following simple steps:

• Step 1: Begin your loan application by assessing your abroad education loan eligibility through GyanDhan.
• Step 2: Upon completing the eligibility application form, you will be connected with an education loan expert from GyanDhan. The loan expert will guide you through the loan application process, providing details about the preferred lenders based on your requirements and application.
• Step 3: Based on the specific requirements of the lender, you will receive a customized document checklist that outlines all the necessary documents and potential alternatives for easier arrangement.
• Step 4: Depending on the lender's guidelines, you will be instructed to submit the documents either in hard copy (collected by a relationship officer) or soft copy (uploaded on the portal).
• Step 5: Once the documents are submitted, the verification process will commence, typically taking 7-15 days depending on the lender and loan type. Upon loan approval, you will receive an agreement letter for review and signing. The GyanDhan user dashboard allows you to monitor the real-time progress of your loan application.
• Step 6: After signing the agreement, you can initiate the disbursement process at your convenience, adhering to the lender's standard procedures.

It is important to ensure that you have explored all the options of the lenders by comparing them with each other based on different factors before starting your abroad education loan for Canada. With GyanDhan, you can skip all the hurdles by simply contacting us. You can get the benefit from our streamlined education loan process and free help in getting education loans to study in Canada. Our expert education loan counselor will discuss the loan options available to you after understanding your academic and financial profile. We work in partnership with several lenders in the market, including government banks, private banks, and NBFCs. Contact GyanDhan and you will not have to worry about your abroad education loan process.

 

Read Also:

• SOP for Canada Student Visa
• Why study in Canada?
• Best Universities in Canada
• Guide to Public Universities in Canada
• Scholarships for Indian Students in Canada

 

Frequently Asked Questions

Is doing PG Diploma from Canada valuable?

 

Yes, a PG Diploma from Canada is highly valuable. With excellent educational institutions, practical training, and international recognition, it enhances job prospects and opens doors to global career opportunities.

What is PG Diploma course in Canada?

 

A PG Diploma is a specialized postgraduate qualification obtained after completing a Bachelor's degree, providing focused knowledge and practical training in a specific field. It enhances job prospects by equipping students with specialized skills.

Can NRI Applicants get education loans for Canada?

 

Yes, you can get an education loan for Canada even if you are NRI. The main concept would be sharing the power of attorney with someone related to you that is in India that can complete the process on your behalf. 

Can I get an education loan for UG Diploma in Canada?

 

Yes, you can get UG Diploma education loan for Canada. You can get up to 50 Lakh INR if you are eligible as per lender requirements. 

How much bank balance is required for a Canada student visa?

 

Applicants for a Canada student visa must demonstrate a minimum bank balance of 10,000 CAD.

How much money is required for GIC in Canada?

 

To fulfill the GIC (Guaranteed Investment Certificate) requirement for a Canadian student visa, you would typically need to deposit around 10,200 CAD in a designated Canadian bank.

Can I get an education loan for GIC?

 

Yes, you can get an education loan for GIC as well, all you have to do is let the bank know and this amount will be included in your total loan amount.

Which bank is best for education loan for Canada?

 

In the case of a secured education loan for Canada you can go for -

• SBI
• UBI 

For unsecured education loan, you can choose from 

• Axis
• ICICI
• IDFC 
• HDFC Credila
• Avanse