Many students and professionals in India think twice before choosing an upskilling program because of the exorbitant price of these programs. However, grants, scholarships, bank loans, and, more recently, credit cards and personal loans have changed the scenario. The easy availability of financing options from banks and non-banking financial companies has given students a new lease of learning. In this blog, let’s explore the different types of financial assistance available and which is the best for you.
1. Credit from Financial Institutions (Including Banks and NBFCs)
Banks offer loans to students for education. Some banks offer fixed-rate loans with higher interest rates and (you know the exact monthly repayments before applying for the loan) collateral loans (you keep gold or property as security against the loan you have taken). Other lenders may offer variable-rate and change their interest rates at any time during repayment.
Some lenders additionally provide flexible repayment choices like part payments or 5-year repayments. If you have a credit history, it can assist you in getting a bank student loan.
2. Loan through Credit Card or BNPL
Credit card loans and BNPL (Buy Now Pay Later) are easy to get, and they are expensive. The interest rates are high, but they offer ease of payment in terms of tenure. If your income is low and/or you have no savings or assets, BNPL financing may help you get through grad school or upskilling by paying for tuition and living expenses until graduation. However, these kinds of loans have a credit limit for one-time usage.
3. Personal Loan
Personal loans are an excellent choice to assist with higher education costs. They are straightforward to obtain, although the interest rate may be greater than that of a credit card. If you urgently need financial assistance and would prefer to avoid the headache of applying for a personal loan, then this is not the most suitable choice for you. However, if you have time on your hands and can wait until after graduation before repaying it, this could be beneficial for your finances in the long run because it won’t affect your credit scores as much as other types of loans would.
The final decision rests on you. Be aware of the various possibilities available and the interest rates for each option so that you can make an informed decision on which one works best for your educational needs.