Students want to apply to international universities for better education and to secure a successful career. It is a dream for students in Nepal to apply for education abroad. But the financial burden can be stressful if you are planning to go abroad. This Education loan helps as a practical solution, offering the financial support required to cover tuition fees, accommodation, travel, living expenses, and other related costs while being out there.
With increased access to international universities, many banks and financial institutions now provide education loan in Nepal for abroad studies schemes tailored to students who want to study abroad.
What is an Education Loan?
An education loan is a financial product that is designed to support students in funding their academic journey. In Nepal students can take education loans for both domestic and international education. If students are planning to study abroad and are not able to meet the financial need, they can apply for education loans. These loans typically cover tuition fees, living expenses, visa charges, air tickets, insurance, accommodation, food, books, and even pocket expenses.
The education loan is granted on conditions like fixed assets or deposit as collateral and repaid over time through monthly installments.
Who Can Apply For Education Loan in Nepal?
Below are the headings with criteria to apply for an education loan in Nepal:
General Eligibility Criteria
To qualify for an education loan in Nepal, applicants must:
- Be a Nepali citizen
- Be above the age of 18
- Hold an official admission letter from an accredited foreign educational institution
- Demonstrate a genuine financial need for assistance
Collateral Requirements
Nepali banks typically require collateral to approve education loans. Common forms of accepted collateral include:
- Land or real estate (most frequently used)
- Fixed deposits held in the applicant’s or guardian’s name
- Government-issued securities
- Life insurance policies with a surrender value
Some financial institutions also accept collateral from third-party sponsors, offering greater flexibility for students who do not have personal or parental assets.
Co-Applicant Requirements
A co-applicant—usually a parent or legal guardian—is essential for loan approval. This individual must meet the following criteria:
- Have a verifiable and stable source of income
- Be 18+ of age to apply
- Possess a strong credit history
- Be a Nepali citizen
The co-applicant assures the bank of repayment capability during the study period and supports the applicant’s financial credibility.
What Expenses Are Covered?
Education loans in Nepal for international studies typically include:
- University/college tuition and enrollment fees
- Visa application and processing charges
- Travel costs, including air tickets
- Accommodation and hostel charges
- Living and daily expenses
- Medical and travel insurance
- Books, equipment, and other academic materials
- Language test and entrance exam fees (like IELTS, TOEFL, GRE)
- Margin money for blocked accounts (depending on country requirements)
Loan Amount and Tenure
The loan amount varies by bank but typically ranges from NPR 0.2 million to NPR 10 million, depending on the institution, country of study, and collateral value. Most banks cover up to 90–100% of the total education cost. Repayment terms extend up to 15 years, including a moratorium period during the course duration and a 6–12 month grace period afterward.
Interest Rates and Repayment
Interest rates for education loans in Nepal generally fall between 9.5% and 16%, depending on the bank, collateral value, repayment plan, and student profile. Students typically begin repaying their loans after graduation, although interest payments may begin during the study period. Some banks offer interest-only payments during the moratorium period to ease the financial burden on students and their families.
Repayment is typically structured in monthly EMIs (Equated Monthly Installments), and early repayment options are available with or without penalty based on the lender’s policy.
Required Documents Checklist for Education Loan in Nepal
General Documents
- Photograph (2 copies each)
- Citizenship and Passport of student
- Academic Certificates of student
- IELTS/PTE Scorecard
- PAN of loan applicant
- Relationship Certificate along with citizenship of family members
- Marriage Certificate (if married)
- Offer letter from University
Income Source Verification (verify it from Ward)
- Salary Income
- Business Income
- Pension
- Vehicle Rent income
- Land lease/House rent income
- Agriculture
- Income from Foreign Employment
Collateral-related documents:
- Land ownership certificate (Lalpurja)
- Plot should have at least an 8-foot-wide road with motorable access. (Should be mentioned in charkilla, or else bato pramanit forward is required)
- Plot should be free from Guthi and/or Mohi.
- Plot should be far away from the high-tension line.
- Plot should not be owned by third-party collateral
- Blueprint and Trace Map of land from Survey Office/Napi Karyalaya.
- Four Boundary Certificates ("Char Killa" certificate of the proposed site) from Ward office of the concerned municipality/VDC.
Application Process For Education Loan in Nepal
Following are the steps that you can use to apply for education loan in Nepal:
- Research and Compare: You can start by comparing the services under education loan offered by various banks. Compare them in terms of interest rates, tenure, processing time, and coverage.
- Get Accepted at Accredited University: Students need to show proof of acceptance at known universities in order to begin further processing on education loans.
- Consultation and Pre-Assessment: Visit your chosen bank or consultancy partner to understand your eligibility, documentation needs, and financial feasibility.
- Document Submission: Gather and submit the required documents, as we mentioned above, such as academic, financial, and legal documents, along with guarantor documents and your application form. If you have any sponsor, you have to provide their details too.
- Loan Processing and Approval: Submit your loan application, and the bank will assess your documents, property valuation, admission credentials, and repaying capacity before approving the loan.
- Disbursement: Once your loan is approved, the loan amount is disbursed in one or multiple installments as per university requirements and agreed terms.
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Benefits of Taking an Education Loan
You can get tons of benefits by taking an education loan while planning to study at international universities. Below are some that you can visualize:
- Enables access to world-class education without financial roadblocks
- Preserves personal and family savings for emergencies
- Builds financial responsibility and credit history
- Structured repayment options with long tenure
- Some loans offer flexible interest-only repayment during study period
- Can also fulfill embassy requirements for proof of funds (in countries like Germany, Australia, or Canada)
Challenges to Consider
- Collateral requirement may restrict access for families without assets
- Interest rates are relatively high compared to international standards
- Loan approval and disbursement may take time due to documentation and evaluation processes
- Currency exchange rate fluctuations may impact loan adequacy and repayment
Tips for a Successful Loan Approval
You can follow these simple tips while applying for and processing education loans.
- Ensure all property and income documents are valid, updated, and complete
- Approach trusted banks with dedicated education loan departments or partner consultants who can assist with documentation and liaison
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Conclusion
Loans like education loans have become a vital bridge for students who are planning to study abroad. Whether you head to the UK, Australia, the US, Canada, or any other popular destination, these loans help international education be financially feasible. If you choose the right bank, prepare your documents carefully, and understand your repayment capacity, you can take a confident step toward your academic and professional future.
If you need help choosing a loan provider, join us at Bizz Education. We provide professional assistance in every part of the education loan application. We provide expert guidance on preparing documents and get deep knowledge on how these education loans work. Contact us and get a chance to study abroad at ease.
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