Along with the rising everyday expenses, the cost of pursuing education in Nepal has also increased significantly. Nowadays, educational expenditure have become a festering financial burden for every family.
So, along with the knowledge and hard work, Nepali students are obliged to have financial support to pursue a course of their choice and secure a great education.
Apart from financial burden, lack of quality education, limited employment opportunities, a high degree of political instability and disrupted socio-economic conditions due to earthquakes have shown disastrous on the Nepali education system.
These factors have eventually impacted the students and incited them to migrate to foreign countries for pursuing a proper educational career, even though the abroad studies are anchored with a high cost of living and hefty migration expenses.
Now, Nepal is one of the top nations with the majority student population studying abroad and the number is increasing year on year. India, Australia, the United States and the United Kingdom are the preferred destinations for the Nepali students.
Nepali student Migration in Numbers:
In the recent decade, the student migration in Nepal has experienced a sharp rise with a nearly six-fold increase in the FY 2018-19.
Even though the outbound student mobility from Nepal is incessantly increasing at a high rate, many students hadn’t obtained education loans to fund their education and other expenses.
This is mainly because the educational loans in Nepal require collateral, complex documentation procedures and high-interest rates.
In view of this, the Nepali Government banks and other financial institutions have eased the education loan process and provided competitive schemes for Nepali students for a better educational career.
Education loan in Nepal is financial support for the students aspiring for higher studies in Nepal as well as abroad. The purpose of the loan is meant to cover all expenses incurred during the completion of a course. It includes:
Apart from covering the educational expenses, education loan offers many benefits. A few of them are:
However, to avail the aforementioned benefits of education loan in Nepal, the applicants must meet certain criteria and accept a few terms and conditions set by the loan provider.
If you are looking to know how to apply for an education loan in Nepal to pursue further studies in the nation or in abroad, here are few key takeaways about the loan application, approval and related services.
Eligible Courses: Nepali banks provide educational loans for almost any course provided that the concerned educational institute is recognized by Nepali Government. The eligible courses include:
Supportive documents required for the educational loan approval in Nepal include:
Note: Documents listed above are just some of the banks’ requirement and the list may vary as per their rules and regulations.
There are many banks in Nepal that provide educational loans to aspiring students. But, it’s imperative for the students to compare the study loan on various parameters, terms and conditions.
The applicant should make sure to understand details like total loan cost, monthly installments, interest rate, loan processing fees, subsidies, grace period, term period, loan processing time, repayment scheme, moratorium period and so on.
So, the students are obliged to look into several banks and do some research regarding the application process.
Tenure: Up to 10 years (Exclusive of moratorium period of 12 months)
Repayment: EMI based
Interest Rate: Base Rate + 0.50 to 6.00
Note: Students who are applying educational loan for MBBS/BDS studies in Nepal can avail “Sanjivani Education loan Scheme” provided by the bank.
Fees and Charges:
Financing %: Up to 70% of Fair Market Value of real estate collateral or 80% of total education expenses.
Tenure: Maximum 12 years (including 2 years moratorium period)
Loan processing fee: 1% of the loan amount
Repayment: EMI based
Loan Amount :
Financing %: Up to 90% of the Distress Value subject to the maximum loan limit
Tenure: Maximum of 15 years
Loan Fee: Management Fee of 1% of the sanctioned loan amount
Repayment: EMI based
Tenure: Minimum 1 year and maximum up to 10 years
Moratorium Period: Up to a maximum of 3 years or course duration (Whichever is earlier)
Repayment: EMI basis after the moratorium period
Other leading banks include:
Note: Before reaching out for the banks for an education loan application, check if you can apply it online so that you can save much of your time.
Many times, banks are willing to offer a loan amount higher than what you need. But, you may not need to accept the entire loan amount since you have to pay back the loan with interest. So, it is ideal to borrow what you need.
Before choosing an education loan, it’s imperative for the Nepali students to check whether any form of scholarship is available for them or not. Because, many colleges in Nepal are offering merit-based, need-based, as well as extracurricular scholarships.
So, it is highly recommended to find whether you are eligible for any scholarships and apply wherever possible.
Stay tuned to NepaliSansar.com for more latest education news updates!
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