Education Loan For Canada
Education Loan

Guide to Study Loan for Canada

Guide to Study Loan for Canada

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Read about education loans to study in Canada. Know options available in study loans for Canada. Find Canada study loans for bachelors, masters, diplomas, and MBA.

GyanDhan

Rohit Gidwani

Updated on: 18 Nov 2023
 

 

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 abroad education loan for Canada comes into the picture.

Table of contents

  1. list items Cost to study in Canada
  2. list items Education loan eligibility for Canada
  3. list items Expenses covered by education loan for Canada
  4. list items Types of education loan for Canada
  5. list items Secured education loan for Canada
  6. list items Unsecured education loan for Canada
  7. list items Documents required for education loan in Canada
  8. list items How to choose the best educational loan option?
  9. list items Repayment of education loan for Canada
  10. list items How to get study loan for Canada?
  11. list items Frequently Asked Questions
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Cost to study 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

Program Name Cost per year

Bachelor’s Degree

25,000 CAD - 35,000 CAD

Undergraduate Diploma 

10,000 CAD - 17,000 CAD

Postgraduate Diploma

15,000 CAD - 25,000 CAD

Master’s Degree

30,000 CAD - 40,000 CAD

 

Check Your Education Loan Eligibility


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:

Canada life style

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Education loan eligibility for Canada

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

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

Did you know that from August 10 onwards, Canada will accept the PTE Academic for all SDS (Student Direct Stream) applications?

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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 -
 

Cost to study Living expenses Other costs 
  • list items Tuition fee
  • list items Admission fee
  • list items Examination fee
  • list items Expenses for books, or laptop
  • list items Expenses for study tours
  • list items Accommodation or hostel cost
  • list items Food costs
  • list items Caution fee
  • list items Expenses for travel
  • list items Health insurance expenses
  • list items Miscellaneous expenses
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Types of education loan for Canada

There are mainly two types of Canada student loan:

  1. list items Secured education loans: These loans need some valuable item as security.
  2. list items 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.


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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.

Lender name Maximum loan amount (in INR) Rate of interest Margin money

SBI

Up to 1.5 Cr

10.65% (for girls)

11.50% (for boys)

10%

UBI

Up to 1.5 Cr

10.50% - 10.85%

10% (listed university)

15%(non-listed university)

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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 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

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:

Lender name Maximum loan amount  Rate of interest Margin money

Axis Bank

Up to 50 Lakh INR

11% - 12.50%

5%

ICICI Bank

Up to 1 Cr (Premium University)

 

Up to 20 Lakh INR (Other)

10.85% - 12.50%

0 (Premium University)

 

15% (Other)

IDFC FIRST Bank

Up to 35 Lakh INR 

11.75% - 13.25% 

Nil

Education loan for Canada from NBFC

NBFC has its own set of criteria to give education loans to 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.

Lender name Institution type Loan amount as per course Interest rate

HDFC Credila

University

40 Lakh - STEM 

25 Lakh - Non-STEM

12% - 12.50%

College

30 Lakh - STEM

20 Lakh - Non-STEM

12% - 12.50%

 

Avanse

University

40 Lakh - STEM 

25 Lakh - Non-STEM

12% - 12.75%

College

30 Lakh - STEM 

20 Lakh - Non-STEM

12.25% - 13%

InCred

University

40 Lakh - STEM

25 Lakh - Non-STEM

12% - 13%

College

30 Lakh - STEM 

20 Lakh - Non-STEM

12.25% - 13%

Auxilo

University

30 Lakh - STEM

25 Lakh - Non-STEM

12% - 13%

College

25 Lakh - STEM

20 Lakh - Non-STEM

12% - 13%

 

Check Your Education Loan Eligibility

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. The loan offerings by them are shown below:

Lender name Maximum loan amount  Rate of interest Margin money

MPOWER Financing

Up to 100,000 USD

12.99% - 13.99%

Nil

Prodigy Finance

Up to 100% cost of attendance (in USD)

12% - 14%

Nil

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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 - 

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

Mandatory GIC Policy
A student planning to study in Canada must apply for an education loan before applying for the visa because there is a requirement to purchase a Guaranteed Investment Certificate (GIC)* worth CAD 10,000 under the SDS** (Student Direct Stream).

*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.

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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:

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

Calculate your Education Loan EMI

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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

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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:

  • list items Step 1: Begin your loan application by assessing your abroad education loan eligibility through GyanDhan.
  • list items 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.
  • list items 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.
  • list items 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).
  • list items 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.
  • list items 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.


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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, SBI and UBI are among the best banks to consider. However, for an unsecured education loan, private banks like Axis, ICICI, and IDFC should be your preferred options. If you are not eligible for loans from these sources, you can explore NBFCs like HDFC Credila and Avanse. International lenders could be considered as a last resort.