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Benefits of Education Loan Vs. Self Finance
1

Principal amount payment POST course completion

Self Finance

If self finance, the full year fee has to be paid at the beginning of the semester. Also the living cost needs to be saved for, which in many cases is about 50% of the cost of education.

Education Loan

An Education Loan can cover tuition fee +living costs too. Repayment of the principal amount needs to be done only POST course completion. An addition 6 months is also given by the lenders, before principal repayment starts.

2

Pay in Easy EMIs instead of bulk payment

Self Finance

When self finance, full year payment goes out of the account in one shot.

Education Loan – Period

Education Loan is paid in Easy EMIs. Credila gives a repayment Period up to 10 years, which makes it easy on the pocket.

3

Save for family contingencies + Invest & earn through your savings

Self Finance

self finance amounts to liquidating savings, which could have been kept back as investments and/OR also kept us a financial security for family/health contingencies.

Education Loan

An Education Loan helps you retain your savings to keep them invested and also keep them for family/medical contingencies.

4

Liquidating savings

Self Finance

To self finance, one often needs to break savings, sell property, pledge gold, borrow from relatives.

Education Loan

An Education Loan empowers you to preserve your savings and not go through the harrowing experience of either selling land, jewellery or even borrowing. An Education Loan empowers you to finance by the strength of your education background, current financial status and collaterals. Its Empowers YOUth!

5

Financial Benefits

Self Finance

When self finance, the money that could have been invested and earned you interest/profits, is used up in one shot.( Eg: 10 lakhs earning 10%pa= Rs. 1 lakh earning.) This opportunity to earn is lost.

Education Loan

Availing an Education Loan makes Financial sense!
If Education Loan availed: (example) Borrow Rs. 10 Lakh@ 9.33% * (effective rate of interest) & spend 93000 as interest Invest your money @ min 10%: earn Rs. 1,00,000/- Hence, make Profit of Rs. 7000 p.a by availing loan

6

Proof of funds to secure admission

Self Finance

To get admission confirmation, a solvency letter needs to be given to show liquid funds. One needs to show liquid funds to cover one year fee + approx 50% more to be able to convince the University about the fee payment capacity

Education Loan

One can get the loan sanction from Credila even before admission confirmation. Infact students get the loan sanction at the time of application to Universities & use Credila Sanction/Solvency letter to show 'proof of funds'. Credila's loan sanction/solvency letter has

7

Need not keep liquid funds

Self Finance

One needs to keep liquid funds to get a solvency letter to show 'Proof of funds'. With cost of overseas education ranging between 20-80 lakhs, it's not an easy task to keep such a high amount of liquid funds.

Education Loan

One Need not keep such high amount of liquid funds when one avails on an Education Loan. Sanction/ Solvency letter is received basis the profile of the students, parent and the collateral. And the loan needs to be repaid in easy EMIs.

8

Attractive Tax benefits

Self Finance

One cannot avail the attractive benefits if fee is self-financed.

Education Loan

One can avail attractive Tax benefits on Education Loan availed from Credila. The complete interest amount has Tax exemption, without any upper cap! Truly, a benefit not to miss!

9

Safeguard against cost inflation/fluctuation in currency

Self Finance

With the fluctuation in the foreign currency, the cost of education can vary up to 20-30%, as experienced recently. It can be tough to produce liquid funds to pay such additional amounts.

Education Loan

Availing an education loan sanction can be very useful at this stage. Even if the cost increases, loan can be availed upto the sanctioned credit limit. It is advisable for the students to open a loan account with Credila before flying abroad

10

Timely Payments to University

Self Finance

One needs to keep a track of the fee payment date & ensure the transaction goes through in time to make timely payments to the University. This is specially cumbersome when the payment needs to be sent overseas.

Education Loan

Availing an education loan makes it easy. One simple instruction to Credila & the fee payment will be done.

11

Build Positive Credit History

Self Finance

Paying through life savings does not give you the opportunity to build a positive credit history, which can be very useful for students as they invest in automobiles, credit cards and homes soon after getting their jobs.

Education Loan

Timely repayment of an education loan can help a student build a positive Credit history and get loans for other products like your home, automobile, etc easily and at attractive rates.

12

Opportunity to take responsibilities

Self Finance

Parents financing their child's education takes away the opportunity for the child to take his own responsibility.

Education Loan

Taking an education loan makes students value his education even more and helps him take the mature first step of taking financial responsibility. An opportunity for every parent to give his child 'the wings' to fly!

Credila Financial Services is a Subsidiary of Housing Development Finance Corporation Limited (HDFC) . Housing Development Finance Corporation Limited is one of the leading financial services companies of India.
Credila Financial Services Private Limited Registered Office: B 301, Citi Point, Andheri-Kurla Road, Andheri (East), Mumbai-400 059, India