Education Loans for Diploma Courses Abroad: A Detailed Guide

The names of diploma courses vary in different countries. They are also named Graduate Diploma, Post-Graduate Diploma, Advanced Diploma, etc. In all cases, a diploma qualification has a value that enables students to take up a job or even go for further studies.

When it comes to choosing a diploma course, it is an unnerving task for students as short courses offer a wide range of subjects for study. The course duration depends on the country, course, and college.

Usually, the diploma courses abroad include:

• Undergraduate Diploma Courses
• Postgraduate Diploma Courses

Pursuing a diploma course abroad has several benefits. Some of them are:

• Take less time to complete.
• Highly job-oriented and deliver hands-on training making students job-ready.
• Make students experience a new culture.
• Allow students to learn to work and study independently.
• Typically cost less than the corresponding degree courses.

Studying abroad prepares you to take up a job anywhere around the globe and this remains the focus of international study programs. Studying overseas diploma courses in countries that are technologically developed gives one a wide array of opportunities and new viewpoints that open up for the students.

For foreign diploma courses, students choose countries that are more suited for the purpose.

The best countries to study diploma courses abroad are:

• Canada
• The United Kingdom
• The United States of America
• Australia
• New Zealand
• Ireland

Education loans that are offered for overseas diploma courses can be broadly segmented into two types - Secured Loans and Unsecured Loans. 

1. Unsecured Education Loan

An unsecured loan is a loan without collateral. In these types of loans, the borrower does not need to pledge any tangible or intangible asset. These education loans have a moderately shorter repayment period. Though, their interest rate is higher than that of secured loans. In addition to this, their rate of approval is somewhat lower than that of a secured loan. It must be noted that government banks and private-sector banks do not offer without collateral education loans for diploma courses for more than INR 7.5 Lakhs which is usually not sufficient given the total expense.

2. Secured Education Loan 

A secured loan is also termed a loan with collateral. In these loans, the borrower has to pledge a tangible or intangible asset. Examples of assets are immovable property, insurance policy, FDs, etc. The lender considers this collateral as a security against the amount and can use this to recover the loan amount if there is a case of default. A loan with collateral has a lower interest rate and a longer repayment period as well. Some of the other benefits of taking a secured loan are no requirements for co-applicant’s income, no repayment during the study period, and a higher rate of approval.

To know more about Types of Collateral Security Acceptable for an Education Loan, click here.

When it comes to picking between unsecured and secured study loans provided by NBFCs for diploma courses abroad, it is recommended that students opt for secured loans from government banks like SBI and Bank of Baroda. The interest rate for secured loans offered is comparatively much lower than that for loans without collateral, almost to a difference of 4%-6%. As this difference makes a considerable difference in the EMIs a borrower would have to pay, one should select that option that significantly decreases their financial drain in the future. Consequently, even if you are unable to pledge any of your own assets as collateral, you could also consider putting a third-party collateral- an asset owned by a third party.  

The interest rate on the education loan is different for different lenders which ranges from 8%-16%. Income tax benefits can be claimed on the principal part of the study loan provided the individual is directly linked to the borrower and has taken a loan from either a government or a private bank. Education loan covers almost all the costs required to complete the course. It encompasses tuition fees, library fees, hostel fees, travel expenses, books and equipment, and other expenses. Lenders also offer a moratorium period (repayment holiday) soon after which the borrower can start the principal amount repayment.  

There are mainly 3 types of lenders that provide education loan to study diploma courses abroad:

• Public-sector banks
• Private-sector banks
• Non-banking financial companies (NBFCs)

• Check your loan eligibility.
• Get expert education loan counseling from GyanDhan’s counselor to compare the education loan products. 
• Choose a lender and apply online on our platform.
• Avail of your customized document checklist.
• Submit the required documents either online or get them picked up from your home by our representative.
• Get the property & other legal evaluation done (in case of loans with collateral).
• Get your loan sanction letter once the lender approves the loan.

GyanDhan has partnered up with top education loan lenders in the market and can help you get an education loan without any hassle. The loan process for abroad diploma courses is streamlined so that you can get an education loan without running from pillar to post. Your assigned loan counselor will be available to you all through the loan process to keep you updated on your loan status. Also, if any problem erupts in the loan procedure, it will be swiftly resolved by them, through leveraging our partnership with the lender. GyanDhan offers loan assistance free of cost to the students. To apply, check your loan eligibility now!