The education sector is one of the fastest-growing sectors in India. With almost 29% of the total population under the age of 14 years, the industry is at a staggering Rs. 6.45 trillion in FY 2018. The recent hike in course, tuition, and other types of fees also mean a large portion of an average family’s monthly income is spent after their child’s education.
Many people are availing higher education loans to resolve the financial burden increasingly associated with education. Financial institutions, including NBFCs, offer such types of credits with attractive features and benefits. However, there are specific reasons why you should consider an NBFC for availing personal loans for higher education.
Why are NBFCs popular today?
In recent years, public sector financial organizations have been plagued with defaulted repayments, primarily in the education loan category. It made the fund disbursement process more stringent and the offerings smaller. Also, public sector lenders lend the money deposited by their investors, which comes with higher liability.
On the other hand, NBFCs have fewer regulations thanks to their separate investment policy. This allows a lot more flexibility when you apply for a personal loan for higher education. The ease of availing finances also plays a crucial role in favor of NBFCs. Easy to meet eligibility criteria, minimum documentation, flexible tenors, and various other factors attract borrowers to these financial institutions over other ones.
Why should you opt for a loan from an NBFC?
- Shorter approval and disbursal time – NBFCs offer some of the quickest approval and disbursal times. While some public and private sector financial organizations may take months for processing the application, NBFCs generally take no more than a few minutes to approve a personal loan application. The loan amount is usually disbursed within 24 hours of approval.
- A wide range of courses are accepted – NBFC’s generally approve credit for a variety of courses not recognized by various other Government and public sector financial institutions. This can prove beneficial if you want to pursue a niche career at an institution not yet enlisted to these schemes or as liaison with financial institutions.
- Funding requires minimum documentation – Quicker approval and disbursal is further augmented with minimum documentation and the easy to meet personal loan eligibility criteria. Borrowers often face months of waiting in public or private sector financial institutions for their loans to be approved. Also, you have to submit the bulk of paperwork before the disbursal process starts.
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On the other hand, NBFCs requires only the essential documents for a credit. You need to have a good CIBIL score and submit your KYC documents, proof of employment, salary slip of the last 2 months, and bank account statement for the last 3 months to apply successfully. They are collateral-free and thus do not require the borrower to pledge any asset when you apply for the funds. That also simplifies the documentation process as you don’t have to present any paperwork for the collateral.
- NBFCs offer competitive interest rates – Borrowers also benefit from the competitive interest rates on these loans. NBFCs can offer rates as low as 12.99% onwards, which is among the lowest interest rates offered by top financial institutions across India. You can avail as much as Rs. 25 Lakh with such low-interest rates on personal loans.
- Flexible tenors – As a borrower, you will also get the opportunity to choose the loan duration according to your preference. A flexible tenor ranging from 24 to 60 months offer the best possible terms for you to repay the principal amount.
NBFCs are quickly becoming the most preferred organization to avail of financing for higher education. Their borrower-friendly terms make repaying higher education loans easier and hassle-free. Whether studying abroad or in India, a personal loan can help you overcome the hurdle of the financial burden with ease.