Education Loan for Germany

While Germany is also known for being one of the most affordable countries for studying, international students still have to face certain living expenses. This article will dive deeper into the topic of securing an education loan for Germany, covering every detail from eligibility criteria to paperwork, the loan process and providers.

Germany has become one of the top choices for students wanting to study abroad. It is ranked as the third most popular nation, with over 416,437 foreign students enrolled in the German higher education sector as of the winter semester of 2020/2021. Unlike any other country, Germany has around 12 universities that have made it to the world’s 200 top-ranking universities list of QS. Furthermore, countless course choices, exceptional research facilities, and high employability make the city a higher education paradise. 

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Process for Applying for an Education Loan For Germany 

Many government-funded and non-government-funded organizations in India help students finance their studies in Germany. Students can also check the scholarship programs offered by the universities they are applying to. Some have loan schemes to support international students.

The process to apply for an education loan for Germany would be specific to the bank or NBFCs students have selected. However, they can find relevant information and details easily on the website. 

It is also important to decide the kind of loan the applicants opt for – secured or unsecured.

• When it comes to a secured loan, students will be asked to provide the bank with collateral security and will probably pay a lower interest rate.
• An example of an education loan for Germany without collateral is an unsecured loan in which students will have to pay a high-interest rate.  

Another choice is BAföG or Bundesausbildungsförderungsgesetz, roughly translated as the Federal Training Assistance Act. It is an education loan in Germany for international students that supports those that undergo training. Students can apply for the same by visiting its website or posting the application along with their documents. 

List of Documents Required 

To procure an education loan to study in Germany, students have to submit specific documents that can vary as per the bank or NBFCs guidelines. However, most requests for the same set of paperwork as listed below:

1. Copy of the admission letter from the university 
2. Loan application form 
3. Academic documents – mark sheets and passing certificates
4. Identity proof- Aadhar card, Pan card, Passport 
5. Residence proof 
6. Documents on the fee schedule 
7. Income proof of the guarantor 
8. Bank statements/passbook 

Eligibility Criteria to Apply for an Education Loan to Study in Germany

Once students have decided to take an education loan to study in Germany, the next step is to look at the qualifying requirements. Some of the eligibility criteria considered by finance institutions in India are:

• The student must be a citizen of India 
• The student must have been admitted into the German Universities recognized by the selected bank 
• The student must have to be at least 18 years of age 
• The student must have been accepted to a job-oriented program to repay the loan amount following their study
• The applicant must deposit a sum of 8,640 EUR to their bank account every year to show as an education loan for Germany blocked account.

Expenses Covered Under Education Loan

At the time of admission, German universities provide students with documents that clearly mention the total cost required to complete the chosen course. Though these institutions do not charge a tuition fee, there are additional expenses students have to cover during their stay in Germany. 

While the university loan will strictly finance educational expenses, the private and public loan amount will cover the listed expenses:

• Housing and Stationery expenses 
• Travel and transport costs 
• Tuition costs (if any) 
• Study tours, project works, and fieldwork undertaken during the study 
• Miscellaneous expenses incurred during the completion of the degree

Top Loan Providers For Study in Germany  

Given below are some of the leading banking and non-banking offering education loan for Germany:

Name of the Institution	Educational Loan Amount	Interest Rate	Expenses Covered
HDFC Credila	€10,500 and above	12.80% (changes from time to time)	Up to 100%
Avanse Student Loans	€1,13,802.99	10% – 16.5%	75% of living expenses
Incred Finance	€11,381.18 and above	12.75% – 16%	Living, travel and education-related expenses
Axis Bank	€56,924.98 and above	13.70%	Hostel chargers and education-related expenses
ICICI Bank	€4,550.89 to €40,957.99	11.25% – 14.25%	Insurance, travel, and accommodation expenses
Prodigy Finance	Up to $15,000.00	10.50%	Living expenses
SBI Edvantage	€11,377.48 to   €1,13,774.80	10.80% to 12.50%	Limited living cost – accommodation and travel only

The Bottom Line 

To avail of an education loan for studying in Germany, students must initiate the process as soon as they acquire their admission letter. They must carefully calculate the required amount and apply for the same at the institution that best meets their needs.