Avanse has been leading the way for NBFCs (non-banking financial corporation) when it comes to offering overseas education loans for students aspiring to study abroad or in India. With the aim of making education accessible for all, DHFL started an Avanse education loan in 2012. In fact, they claim to hold the leadership position in education loan among popular NBFCs offering overseas education loans and were awarded “The Best education loan provider: in 2019 by BFSI. It covers more than 6,000 courses at 1,626 universities and 1,262 colleges across 44 countries.
Is Avanse the best option for Student’s Loan?
The best option for an education loan depends on your eligibility criteria.The Nationalised banks are definitely cheaper as compared to Avanse. The reason banks charge a fixed and low processing fee, their rate of interest is also low is because they only provide education loan study for abroad against collateral. Choose public banks if you want to apply for a secured loan. Choose avanse in case of an unsecured loan.
Since it is a Non-Banking Finance Company (NBFC), they charge a processing fee of 1%-2% of the entire loan amount. Even their rate of interest is quite high and starts at 12.65% + Spread. 12.65% is their base rate and spread is floating and is calculated on the basis of overall credit and course profiling.
This is a big thing when applying for a loan from an NBFC, they offer a floating rate of interest. So your ROI could go up or down as per the terms and conditions of the company. However they have many advantages and you should look at the following Reasons to Choose Avanse:
1. If you don’t have collateral.
2. Low turnaround time - Your loan application can get approved in one week. So if you are hoping to get an education loan fast then an Avanse education loan is a good option. They have dedicated RMs who can give you home service and get your loan approved.
3. Repayment is also relatively easier for Avanse Education loan. The maximum repayment tenure is 10 years. The grace period is of 6 months or 3 months after getting the job, whichever is earlier.
4. 100% loan coverage - They cover 100% of the tuition fee, living expenses, and travel expenses. There are a few terms and conditions to this though. Like, living expenses cannot exceed 20% of the total tuition fee.
5. Avanse does not keep any cap on the maximum amount that can be applied. So they may approve a higher loan amount on the basis of the chosen course and country.
Is Avanse Trustworthy?
Yes, one can trust Avanse because the International Finance Corporation (IFC), an arm of the World Bank, holds a 20% equity stake in Avanse and other part is owned by and other part is owned by Warburg Picnus. They are pretty well known and many aspiring students who want to study abroad got their loan sanctioned in less than a week’s time.The best part is that you don’t have to make arrangements for margin money and also saves you from the endless process of loan approval as they provide quickest loan approvals.Few more things about Avanse is that they have flexible loan schemes for every individual and 100% finance facility in which the course fee & living expenses both are covered.
Conclusion
Avanse, like any other service provider, is providing a service with an income expected in return. Hence Avanse is aggressive in terms of expanding its market share. They do so by trying to give a “better” service as compared to existing market leaders - Banks and their competitor - Credila. If you are checking in terms of service, they could be much better than banks as NBFCs are generally faster in processing. In terms of cost (ROI), slightly expensive compared to banks. Policy-wise they are more or less the same.