Education Loan

Education Loan for MBA in USA for Indian Students

Education Loan for MBA in USA for Indian Students

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Compare loans to study in USA. Check eligibility criteria, interest rates, cost of study etc. Up to 1.5 Cr from starting @10.5% from SBI, UBI, Axis, ICICI, more

GyanDhan
Madhuwrita Nandi
Updated on:  01 Dec 2023  | Reviewed By: 
Aman 
| 6.41K | 11  min read

During the 2021/22 academic year, an impressive number of approximately 199,100 Indian students ventured to the United States for higher education. Notably, around 26,000 of them opted for business and management programs, accounting for 13.3% of the total. The QS Global MBA Rankings 2023 further revealed that the list features over 100 universities/colleges from the USA, with an impressive 39 institutions securing positions within the top 100. Pursuing an MBA in the USA carries the advantage of global recognition; however, it is essential to consider the substantial costs involved. To meet their financial needs, many international students turn to abroad education loans. Exploring the available loan options becomes crucial in making an informed decision about embarking on an MBA journey in the USA.

 


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Cost to study MBA in USA

MBA programs in the USA can come at a significant cost but being globally recognized can provide good returns with career opportunities in the future. International students can expect to pay tuition fees ranging from approximately USD 60,000 to USD 80,000. The living expenses to study MBA in the USA account for USD 8,000 to USD 10,000 per month.

A general bifurcation for the same has been shown below: 

Expenses Cost

Accommodation

USD 9,800 - USD 11,100 per year

Food

USD 250 - USD 500 per month

Travel

USD 300 - USD 700 per year

Utilities

USD 100 - USD 150 per month

Health Insurance

USD 700 - USD 1,100 per year


The average tuition fees for the top 5 MBA universities in the USA have been shown in the table below:

University Name Average tuition fees per annum

Stanford Graduate School of Business

USD 70,000 - USD 75,000

Harvard School of Business

USD 70,000 - USD 75,000

The Wharton School

USD 78,000 - USD 82,000

MIT Solan School of Management

USD 75,000 - USD 80,000

Columbia Business School

USD 80,000 - USD 85,000


 

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Types of education loans for MBA in USA

When it comes to Indian students studying MBA in the USA, education loan options can be broadly categorized into two types. The first category is secured education loan, which necessitates the applicant to provide collateral as security during the loan application process. Collateral can include assets like Fixed Deposits, LIC Insurance, non-agricultural land, residential property, or commercial property. It's worth noting that most public banks in India require collateral for education loans for studying abroad.

Want to know more about different types of collateral security?

The second category is unsecured education loans, which does not require collateral as security. Unsecured education loans come with higher interest rates compared to secured loans due to the increased risk for the lender. These loans often require a co-applicant or co-signer, and the loan amount is determined based on the co-applicant's income and CIBIL score.


 

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MBA in USA secured education loan

As mentioned earlier, secured loans require collateral, enabling higher loan amounts compared to unsecured loans.

Additionally, secured loans may not require a co-applicant. When considering education loan options for studying an MBA in the USA, two recommended public sector banks are-

  1. list items State Bank of India (SBI)
  2. list items Union Bank of India (UBI)

Here is a comparative analysis of these banks' education loan offerings for studying in the USA.

Lender Name Maximum Loan Amount (in INR) Rate of Interest Margin Money

SBI

Up to 1.5 Cr

  • list items 10.65% (for girls)
  • list items 11.50% (for boys)

10%

UBI

Up to 1.5 Cr

10.5% - 10.85%

  • list items 10% (listed university)
  • list items 15% (non-listed university)
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MBA in USA unsecured education loan

If you don't have collateral for an education loan to study MBA in the USA, there are alternative options available through Private banks, NBFCs (Non-Banking Financial Companies), and international lenders. Private banks and NBFCs may require a co-applicant with a minimum financial income and no liabilities, while international lenders offer loans without a co-applicant. Opting for international lenders can be advantageous as they provide loans in USD, potentially saving on foreign exchange charges and other costs. However, it's important to note that international lenders typically have higher interest rates. Each lender offering unsecured education loans for MBA in the USA has its own pros and cons. To assist in your decision-making process, we have prepared comparative data of these lenders.

Lender Name Maximum Loan Amount  Rate of Interest Margin Money

Axis Bank

Up to 50 Lakhs INR

11% - 13.50%

5%

ICICI Bank

Up to 50 Lakhs INR

10.85% - 12.50%

0 - 15%

IDFC FIRST Bank

Up to 50 Lakhs INR 

11.50% - 12.25% 

Nil

HDFC Credila

Up to 65 Lakhs INR

11.25% - 13%

Nil

Auxilo

Up to 65 Lakhs INR

11.25% - 13%

Nil

Incred

Up to 60 Lakhs INR

12.25% - 14%

Nil

Avanse

Up to 75 Lakhs INR

12.50% - 13.50%

Nil

MPOWER Financing

Up to 100,000 USD

  • list items 12.99% (for graduate programs) 
  • list items 13.99% (for undergraduate programs)

Nil

Prodigy Finance

Up to 100,000 USD

12% - 14%

Nil


Education loan for experienced professionals - ICICI Bank offers a loan option for applicants with a minimum of 3 years of experience, eliminating the need for a co-applicant. The loan amount and other variables remain unchanged as shown in the table above. Two additional requirements include a minimum monthly income of INR 35,000 (which may increase for higher loan amounts) and the necessity to create a Fixed Deposit (FD) to cover the total Simple Interest payable during the moratorium period, ensuring a free moratorium.

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How to choose the best lender for MBA in USA student loans?

When evaluating education loan options for an MBA in the USA, GyanDhan offers helpful advice to select the most suitable loan and minimize future financial burdens. To make an informed decision, it's crucial to compare the following aspects across lenders and loan schemes:

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Expenses covered by education loan for MBA in USA

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

Cost to study

  • 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

Living expenses

  • list items Accommodation or hostel cost
  • list items Food costs
  • list items Caution fee

Other costs 

  • list items Expenses for travel
  • list items Health insurance expenses
  • list items Miscellaneous expenses
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Required documents for MBA loans for USA

It is essential for students to collect all the required documents for applying for an education loan to study MBA in the USA. While the document checklist can be extensive, GyanDhan offers a personalized document checklist to streamline the submission process for you.

Document required for secured education loan Document required for unsecured education loan

The applicant and co-applicant KYC documents.

KYC of the applicant & co-applicant.

Citizenship and residence proofs of both the applicant and co-applicant.

Citizenship and residence proofs of the applicant & co-applicant.

Relevant mark sheets and academic qualification records.

Relevant mark sheets of the applicant.

Proof of admission to the chosen educational institution is necessary.

Basic academic qualification records of the applicant.

The co-applicant must provide their bank statements and income tax documents/Form 16.

Admission proof and fee structure.

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Education loan eligibility for MBA in USA

International students seeking an education loan in the USA must meet certain eligibility criteria. These include:

  • list items Obtaining confirmation of acceptance from a recognized American institution for a full-time master’s program.
  • list items Being at least 18 years old.
  • list items Demonstrating a strong academic track record.
  • list items Choosing a course of study with promising career prospects.
  • list items Providing collateral, if applying for a secured loan.  

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How to get education loan to study MBA in USA?

Securing an education loan for pursuing an MBA in the USA is typically a straightforward process. However, managing multiple lenders individually can be overwhelming. To simplify this procedure, GyanDhan offers streamlined assistance in obtaining an education loan for an MBA in the USA. They guide you through the following steps:

  1. list items Check your eligibility for an education loan for an MBA in the USA on GyanDhan's platform.
  2. list items Connect with a dedicated loan expert who will assist you throughout the application process and suggest suitable lenders.
  3. list items Receive a personalized document checklist to simplify the organization of required documents.
  4. list items Submit the necessary documents either in hard copy or soft copy, following the lender's guidelines.
  5. list items Await verification, which typically takes 7 to 15 days. Once approved, sign the agreement letter and monitor progress through GyanDhan's user dashboard.
  6. list items Initiate the loan disbursement according to the lender's procedures, with funds being directly deposited into your account or disbursed to the university by international lenders.
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How to repay MBA in USA education loan?

When obtaining an education loan for pursuing an MBA in the USA, it is crucial to consider the repayment terms. The repayment tenure and moratorium options are essential factors when selecting a lender. 

There are various repayment options available, including

  • list items Partial Simple Interest (PSI)
  • list items Simple Interest (SI)
  • list items Equated Monthly Installments (EMI)

To help you make an informed decision, we have created a comparative guide that focuses on repayment as a key aspect of obtaining a loan for studying MBA in the USA.

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


Do you know: There are tax benefits on education loan under section 80(E) when you are taking a loan from SBI, UBI, Axis, ICICI, IDFC, or HDFC Credila. 

When applying for an education loan to pursue an MBA in the USA, it is important to carefully evaluate and compare the offerings of different lenders. However, GyanDhan provides a convenient solution to simplify the process. By reaching out to us directly, you can benefit from our streamlined education loan assistance. Our education loan expert will assess your academic and financial background and guide you through the available loan options. With our extensive network of partnerships with government banks, private banks, and NBFCs, we can help you find the most suitable loan for your needs. Best of all, our assistance is provided free of charge. So what are you waiting for? Check your loan eligibility now!

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