Rising education costs, changing study destinations and greater focus on course relevance are influencing how students plan higher education. In this Q&A, Yogesh Rawat, Chief Business Officer – Student Lending International, Avanse Financial Services, discusses evolving education-finance trends, the importance of transparency and factors students should consider before taking an education loan.
1. How is the education and study-abroad lending landscape changing
Education continues to be an important priority for Indian families, while the cost of higher education, particularly overseas education, has increased over time. Students and families are therefore paying greater attention to how they plan and finance these expenses.
The education-finance sector is also evolving with changing student preferences. Specialised lenders and banks are using technology and education-related information to assess applications and understand the requirements associated with different courses and destinations. For students, this can mean greater attention to financing options suited to the duration, location and cost of a programme.
2. Are factors such as course relevance and career prospects becoming more important alongside university rankings?
Students are increasingly considering several factors before selecting a programme. University reputation remains relevant, but course content, academic fit, cost, location and potential career pathways can also influence the decision.
For lenders, assessing an education loan can involve looking at factors such as the student’s academic background, the course being pursued and the overall cost of education. A broader assessment can help lenders understand the financial requirements associated with a particular programme rather than relying on a single indicator such as institutional ranking.
3. How are changing visa policies and the emergence of new study destinations affecting education financing?
Students are becoming more attentive to factors such as visa regulations, post-study opportunities, tuition costs and living expenses when evaluating international education.
This has contributed to greater interest in destinations beyond the traditionally popular markets. Countries in Europe, Asia and the Middle East are increasingly part of the conversation around overseas education.
For lenders, such changes underline the importance of keeping track of developments across education markets. Students and families, meanwhile, need to assess the complete financial and academic implications of studying in a particular country before making a borrowing decision.
4. Why is transparency important when students take education loans?
An education loan can represent a significant financial commitment, particularly for first-time borrowers. Clear communication about interest rates, repayment schedules, fees, tenure and other terms is therefore important.
Students and families should understand their repayment obligations before accepting a loan. Lenders can support this process by presenting information in accessible language and clearly explaining the terms of the borrowing arrangement.
Responsible financing should also involve assessing the amount required for education against the borrower’s overall financial circumstances.
5. With more international universities establishing campuses in India, could domestic education financing gain importance?
The expansion of international university campuses and the development of specialised programmes within India are creating additional options for students. These programmes can allow learners to pursue courses with international academic associations without necessarily relocating overseas.
As students compare domestic and international options, financing requirements may also change. Domestic education can involve different tuition, accommodation and travel costs, while overseas education additionally involves factors such as currency movements and international living expenses.
For families, comparing the total cost of different educational pathways can therefore be an important part of the decision-making process.
6. Is the role of education-finance providers expanding beyond lending?
The education-finance ecosystem is gradually becoming more information-driven. Students often need to understand not only the amount they can borrow, but also the financial implications of different courses and destinations.
Financial institutions can contribute by providing clear information about loan structures and helping borrowers understand their obligations. However, decisions about courses, institutions and career paths ultimately require students and families to consider academic interests, financial circumstances and individual goals.
The broader trend is towards making education financing more transparent and better aligned with the realities of students’ academic journeys.
7. What should students consider before taking an education loan?
Students should begin by calculating the overall cost of the programme, including tuition, accommodation, travel and other living expenses where applicable. They should then compare available financing options and understand interest rates, repayment terms and any additional charges.
It is equally important to consider the course structure, academic requirements and potential career pathways. Borrowing should be approached as a long-term financial decision rather than simply a way to meet an immediate education expense.
As education choices continue to diversify, informed financial planning can help students and families evaluate opportunities while keeping their longer-term financial responsibilities in view.
