Government Education Loan for SC Students in India to Study Abroad: NSFDC

    Updated on: 01 Jul 2022


    NSFDC, or the National Scheduled Castes Finance and Development Corporation, was established by the Government Of India in 1985 as a not-for-profit company. The institution aims to build a robust structure that would enable students from the Scheduled Caste (SC) community to have better avenues for studying.

    The NSFDC enables students from the SC community to get education loans for studying both in India and abroad. It comes under the Ministry of Social Justice & Empowerment (MOSJ&E), which regulates the entire working of NSFDC, and helps students get a world-class education at a minimal rate of interest and reasonable terms of loan repayment.

    So far, NSFDC has sanctioned thousands of abroad education loans for SC students. Those who don't have the financial means to study abroad and belong to the SC community can get the NSFDC abroad education loan from Government. Now we will discuss all the aspects of borrowing from the NSFDC abroad education loans in detail.

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    Loan Eligibility Criteria

    Before proceeding with other aspects of the education loan, it is important to ascertain its eligibility.

    The criteria are very strict when it comes to abroad education loans by government. Below are the eligibility criteria for taking an abroad education loan from NSFDC:

    • Applicant must be an Indian citizen.
    • Applicant must have a valid Scheduled Caste certificate issued by the competent authority (the designation of competent authority might vary from state to state, but in general, it's an ADM or SDO).
    • The family income of the loan applicant should be up to INR 3 lakh per annum.
    • Applicant must have secured admission to a recognized university abroad on the basis of merit to be able to take a loan from NSFDC.

    These are some broad set of eligibility criteria that students must keep in mind as the income criteria are a must, and also women from the SC community are given priority in the abroad education loan.

    Abroad Education Loans by NSFDC: An Overview

    Loan Particulars 


    Maximum Loan Amount

    INR 20 Lakh

    Rate Of Interest

    4% per annum (0.5% rebate for women beneficiaries)

    Maximum Loan Repayment Period

    15 years


    6 months after getting the job or completion of the course
    (whichever is early)


    The NSFDC loans are made for those who don't have the financial strength to go for higher education in India or abroad. Also, NSFDC is registered as not for profit company which clearly implies that there is no profit motive whatsoever, and thus all the policies are designed by keeping in view the abysmally lower financial capability of eligible borrowers.

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    1. Maximum Loan Amount

    The abroad education loan amount is usually high, and the Government Of India has taken due consideration to it. A maximum loan amount of INR 20 lakh or up to 90% of the course fee, whichever is less, will be sanctioned for your abroad education.

    2. Rate of Interest

    The rate of interest is the most attractive aspect of borrowing from NSFDC.

    The Government Of India gives abroad education loans at an astonishingly low rate of interest, i.e. 4% per annum, and for girls, there is an additional discount of 0.5% on the interest rate.

    Interest amounts to a huge part of loan repayment when it comes to abroad education loans. Even Public Sector Banks don't go as low as 4% on secured loans.

    So, if you have the eligibility for this loan, it's the best you can get from any financial institution in India.

    3. Repayment Period

    The loan repayment time for abroad education loans by NSFDC is 15 years, equivalent to the repayment duration given by most PSBs or private banks.

    Usually, longer repayment time leads to a higher cost of loan but not in the case of the loans offered by the NSFDC. However, students must try to repay the loan as soon as possible.

    The more time you take in repayment, the higher will be the amount you end up paying to the lender.

    4. Moratorium Period

    The moratorium period is the time duration post-completion of studies wherein you don't have to start the loan repayment. This time is given to students to explore job opportunities and also settle before starting the loan repayment.

    The moratorium period is 6 months after getting the job or completion of the course (whichever is early).

    Loan Recovery under the NSFDC Abroad Education Loan

    The loan recovery is also kept pretty smooth, which helps students in paying in small installments without having the need to be financially burdened. The recovery of loans is done in equal quarterly installments spread across the loan tenure.

    1. Loan Procedure

    The loan procedure is simple, and one can get it approved within a month. Just the thing is that you should keep all your documents in order. All the certificates related to caste, income, or any other document that is part of the loan application process must be kept handy.

    Since the documents are scrutinized very strictly, you must ensure that there shouldn't be any discrepancies like a mistake in the name of the student, name of parents, date of birth, etc.

    Ideally, you should start the process right after getting the letter of acceptance from the university, which will help you get the loan approved on time.

    Students have to apply online on the official website of NSFDC and provide the letter of acceptance to the State Channelising Agency(SCAs) in their respective state/UT. You must have secured admission to a recognized regular full-time professional/technical course.

    Also, the Government Of India must authorize the course for which you are applying. The authorization is needed for abroad education loans too. The step-by-step process:

    • Go to the official website and click on apply for the loan.
    • Select your institution from the drop-down menu, and if it's not there, then contact the office.
    • After filling in, thet details, generate the password and keep it for future use.
    • Once the application is submitted, you will get an acknowledgment ID. You have to use it for future logins.
    • Take the printout of the application form as the signed copy of the application form will be needed at the time of disbursement of the loan.

    2. Expenses Covered

    The abroad student education loan by NSFDC gives wide coverage of loans to students so that you don't have to worry about your additional expenses.

    Since studying abroad comes with an overly high cost of living, it becomes important to know the exact coverage of expenses in the loan. The loan covers the following expenses:

    • The tuition fee for the course.
    • The admission fee is payable at the beginning of the course.
    • The cost of books and stationery.
    • The examination fee, library, and laboratory fee.
    • The hostel and mess expenses for students living inside the campus.
    • Insurance Premium for Policy for ensuring loanees against the loan in case of death or permanent disability.
    • The cost of traveling abroad also includes the cost of a visa.
    • The university might ask for other expenses, e.g. caution money, development fees, etc.
    • The cost of buying clothes when going to a country with extreme weather conditions where the temperature might dip way below the freezing point.
    • Other expenses(for unforeseen situations) but that shouldn't exceed 1% of the total expense of the course.
    • The cost related to the completion of the thesis and projects includes the cost of printing and other related expenses.
    • Any other expense that might be necessary for pursuing the course and the expense being certified by the university.


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    3. Courses Covered

    The government has tried to make this as comprehensive as possible and tried to incorporate all the fields of study.

    The number of courses is kept wide enough so that most students can be brought under the net of affordable abroad education loans. Most regular full-time Professional / Technical recognized are included to provide a level ground to students from varying disciplines.

    • Engineering (Diploma/ B.Tech /B.E, M.Tech/M.E.)
    • Biotechnology/Microbiology/Clinical Technology (Diploma/Degree)
    • Architecture (B.Arch/M.Arch)
    • Medical (MBBS/MD/MS)
    • Dental (BDS/MDS)
    • Nursing (B.Sc./M.Sc.)
    • Physiotherapy (B.Sc./M.Sc.)
    • Pharmacy (B.Pharma/M.Pharma)
    • Biotechnology/Microbiology/Clinical Technology (Diploma/Degree)
    • Information Technology (BCA/MCA)
    • Pathology (B.Sc/M.Sc.)
    • Law (LLB/LLM)
    • Education (CT/NTT/B.Ed/M.Ed)
    • Hotel Management & Catering Technology (Diploma /Graduation/Post Graduation)
    • Journalism & Mass Communication (Graduation/Post Graduation)
    • Chartered Accountancy (CA)
    • Physical Education (C.PEd./B.PEd/ M.PEd)
    • Higher education like Doctoral Studies leading to M.Phil/PhD from recognized institutions.
    • Geriatric Care (Diploma/Post Graduate Diploma)
    • Midwifery (Diploma)
    • Journalism & Mass Communication (Graduation/Post Graduation)
    • Actuarial Sciences (Graduation/ Post Graduation/FIA)
    • Management (BBA/MBA)


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    4. Documents Required

    Students must have the documents that are needed for the sanction of the loan. You must have original copies of these documents with you as the same will be needed. The following documents have to be given:

    • Duly filled and signed application form. The signatures should be of the student, parents/guardians as they will be the co-applicant.
    • Two copies of clear passport size photographs of dimension 3.5X3.5 cm.
    • The competent authority issued an original Xerox copy of the SC caste certificate and income certificate.
    • Address proof includes Ration Card, Voter's ID Card, Electricity/ Telephone Bill, Passport, etc.
    • The letter of acceptance by the university.
    • The passing certificate by the earlier institution in the prescribed format is duly signed and bearing the seal of the Institute.

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