Which Lenders Are Offering the Lowest Education Loan Interest Rates in 2025?

Education Loan

Between studying in India and abroad, pursuing higher education levels almost always requires you to make a financial investment. For those who wish to study in another country, getting an education loan is now a major help. With banks and NBFCs offering competitive loans in 2025, picking the right education loan can greatly influence your time studying abroad.

Whether you are aiming for a study abroad education loan from a bank or an NBFC, it is essential to compare interest rates before making a decision. In this quick guide, we will share the lowest education loan interest rates in 2025. Let’s begin!

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Banks Offering Lowest Education Loan Interest Rates in 2025

As of 2025, securing the best 2025 student loan interest rates is crucial to managing the cost of studying. Here are some of the top banks offering the lowest study abroad education loan interest rate:

Bank	Interest Rate	Loan Amount
Bank of Maharashtra	7.60%	Up to INR 20 Lakhs
Union Bank of India	Starting from 8.75%	Up to INR 1.5 Crores
State Bank of India (SBI)	9.15% – 9.65%	Up to INR 3 Crores
Bank of Baroda (BOB)	9.20% – 11.70%	Up to INR 1.5 Crores
IDBI Bank	10.45% – 10.95%	Up to INR 75 Lakhs
Canara Bank	Floating: 8.75% – 10.85%	Up to INR 1 Crores
Canara Bank	Fixed: 8.75% – 11.60%	Up to INR 1 Crores
Bank of India	Floating: RBLR + 1.50% – 1.70% presently 10.35% – 10.55%	Up to INR 1.5 Crores
Bank of India	Fixed: 12.20% – 12.40%	Up to INR 1.5 Crores
Sallie Mae	Starting from 3.45%	USD 175,000

NBFCs Offering Lowest Education Loan Interest Rates in 2025

As of 2025, several Non-Banking Financial Companies (NBFCs) in India offer study abroad loans with competitive interest rates. NBFCs often provide flexible terms, especially for students studying abroad with or without collateral. Here are some of the top NBFCs offering the lowest study abroad education loan interest rate:

Bank	Interest Rate	Loan Amount
Prodigy Finance	Starting from 8.35%	Up to 2,20,000 USD or 100% of your expenses
Tata Capital	11% – 13.50%	Up to INR 2 Crore
Avanse	14.55%	Up to INR 1.25 Crore
Auxilo	BLR 15.10%	100% Financing
Abe	Starting from 3.39%	USD 99,999
MPOWER Financing	Starting from 9.99%	USD 100,000
Earnest	Starting from 3.47%	Full Cost of Attendance

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Key Factors That Influence Education Loan Interest Rates

Education loan interest rates vary for the same loan amount. Understanding the key factors can help you in securing the most affordable study abroad education loan.

Credit Score: A high credit score indicates a great ability to repay your loan, making it less risky for the lender.
Co-applicant’s Financial Profile: Stable income and credit score of the co-applicant increase your chance of approval for the loan.
Loan Amount and Tenure: If you are looking for a high loan amount and a longer repayment tenure, it can increase your interest rates.
Collateral: Collateral or security offered during the loan leads to a lower interest rate compared to a collateral-free education loan for abroad.
University & Program: Loans for top universities or programs might get better rates or easier approval.

Here are some tips to secure a low-interest education loan:

Maintain a Good Credit Score	Choose a Co-applicant with Strong Financials
Opt for Secured Loans	Compare Multiple Lenders
Provide Complete & Accurate Documentation	Negotiate Terms with Lender

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Frequently Asked Questions

How do interest rates for education loans vary between banks and NBFCs?

Banks typically charge between 8% to 12%, depending on your loan type (collateral or no-collateral). While NBFCs charge around 11% – 15% from students for their study abroad loan.

Are there any banks or NBFCs offering zero or subsidized interest rates for education loans?

No, it is not possible to secure education loans with zero interest. However, according to your profile and financial conditions, you can opt for a loan with low interest rates.

What is the typical loan amount and tenure offered by NBFCs for education loans?

NBFCs typically offer education loans ranging from INR 50,000 to INR 2 Crores, with repayment tenure of up to 12 to 15 years.

What are the processing fees and other hidden charges associated with education loans?

The processing fees may range from 0.5% to 2% of the loan amount. However, the fees and other charges vary based on the lender for education loans. Other hidden charges may include prepayment penalties, documentation fees, and insurance costs.

Are there any online platforms to compare education loan interest rates easily?

Yes, there are several online platforms to compare education loan interest rates. Nomad Credit offers a smart loan finder tool to match you with the best personalized options. It saves your time by showing competitive rates from multiple lenders in one place.