Union Bank Education Loan to Study Abroad: Interest Rates, Documents, Eligibility & More

Studying abroad can be expensive; for instance, an MS from an American university can set you back by ₹50 lakhs or more (per year). 

However, these costs fail to become deterrents to the study-abroad plans and dreams of students, because of the option of education loans. 

In this guide, we will find out everything you need to know about Union Bank education loans for Indians students who wish to study abroad. 

Union Bank of India education loans

Union Bank of India, founded in 1919, is a major bank in India. Based in Mumbai, it boasts an extensive network spanning over 2,000 branches across the country.  

Union Bank of India offers a variety of education loan schemes that support students pursuing higher education in India and abroad.

There are two key advantages to taking a loan from Union Bank of India.

• Union Bank of India education loan interest rates are highly competitive
• The terms are simple and easy to understand

No wonder, there’s widespread demand for the Union Bank of India education loan for studying abroad. But how much interest should you expect to pay?

Also Read: Education loan for Study Abroad Guide for Students

Union Bank of India education loan interest rate

Here’s a table summarizing the different education loan schemes offered by Union Bank of India. We have also shared Union Bank education loan rate of interest data. 

Scheme	Course Name	Education Loan Interest Rates (p.a.)
Union Education	Under CGFSEL	11.25% p.a. (Up to Rs.7.5 lakh)
Union Education	Not Under CGFSEL	10.85% p.a. to 12.50% p.a. (No maximum limit)  Need-based financing for NRI students: Up to Rs.30 lakh
Union Education	Premier Abroad	9.25% p.a. to 9.75% (Up to Rs.40 lakh)  10.80% p.a. (Above Rs.40 lakh)
Union Education	Special scheme for premier medical institutes	10.30% p.a. (Up to Rs.40 lakh)  9.30% to 10.05% (Up to Rs.200 lakh)
Union Education Loan for ISB Students	Post Graduate Program in ManagementPGPM	8.20% p.a.
Union Education Loan for ISB Students	Post Graduate Program in ManagementPG-PRO	8.20% p.a.
Union Education Loan for ISB Students	Post Graduate Program in ManagementPGPMAX	8.50% p.a.
Union Education Special Education Loan Scheme	Tier-I Premier Management & Technical institutes	9.30% p.a.
Union Education Special Education Loan Scheme	Tier-II Premier Management & Technical institutes	11.05% p.a. for male students  10.55% p.a. for female students/minority/SC/ST
Union Education Skill Development	Skill Development Loan without deviation to be covered under CGFSSD	10.80% p.a.
Union Education Skill Development	Skill Development Loan with deviation if any & not covered under CGFSSD	12.05% p.a. for female students/minority/SC/ST  12.55% p.a. for male students

This data makes it clear that Union Bank of India education loan interest rates are competitive and students can choose from many viable loan products. Next, let’s understand how you can apply for a loan from Union Bank.

Applying for an education loan from Union Bank for Indian students

If you’re an Indian student seeking an education loan from Union Bank of India, you need to know this. 

How to apply?

You can apply for an education loan from Union Bank by visiting your nearest Union Bank branch. Here is a convenient branch locator. Type in the name of the city and it will offer you a list of all the branches. Otherwise, you can download the application form from their website. However, you will have to submit the form in the bank branch. 

Note: A much better way to get your education loan is via FundRight. Using this unique platform, you can secure your education loan for studying abroad right from your home. We will explain this in detail in a later section of this guide. 

Margin 

All banks need you to bear a portion of the cost of studying abroad. This is generally 10-15% of the total cost of studying abroad. In banking language, this is known as ‘margin’. For example, if a bank specifies a loan margin of 12%, it implies that the bank will fund 88% of your educational expenses.

In the case of Union Bank of India education loan; the margin required is:

• Up to ₹ 4 lakhs: No margin
• Above ₹ 4 lakhs (India): 5% margin
• Above ₹ 4 lakhs (Abroad/NRI): 15% margin 

Coverage of costs 

Your student loan generally provides for all the major costs of studying abroad. These include:

• Tuition fees payable to the college, school or university
• Hostel and mess charges
• Fees for examinations, library and laboratory
• Insurance premium for the student borrower
• Caution deposit, building fund, or refundable deposit supported by institution bills or receipts
• Purchase of books, equipment, instruments or uniforms
• Acquisition of a computer or laptop at a reasonable cost (if necessary for coursework)
• Travel expenses or passage money for studying abroad
• Admission acceptance fee
• Any other expenses required to fulfill course requirements. These include study tours, project work, thesis, etc.

Eligibility for Union Bank of India education loans

The eligibility criteria are quite straightforward and simple. Here are the key criteria:

1. The student must be an Indian citizen.
2. The student should have gained admission to higher or technical education.
3. The admission has to be through a suitable selection process.
4. The institution can be in India or abroad.
5. The student must have cleared any necessary qualifying examinations.
6. A Non-Resident Indian (NRI) student must possess an Indian passport to be eligible for the loan.

Why choose Union Bank for a study abroad loan?

Here are five reasons why a student loan from Union Bank could be a good option for you. 

Competitive Interest Rates

Union Bank education loan interest rates are quite affordable. For most students going abroad, that is a huge relief.

For instance, most banks in India offer education loans for studying abroad at 11.15%, but Union Bank loans are cheaper. Currently Union Bank charges 9.75% for loans up to ₹ 40 lakhs and 9.25% for loans up to ₹ 1.5 crores. 

Over a decade of repayment period, that 1.5% to 2% a month, is a significant amount. 

Transparent Process

Union Bank is known for its transparent and straightforward loan application process.

From initial inquiry to loan disbursement, students can expect to be in total control, with no confusion. There are zero hidden charges, which is another crucial benefit. 

Expert Guidance

The bank has experienced loan officers in every city. When you visit a bank branch, you can expect a decent level of guidance and support throughout the loan application process.

Being a first-time borrower, you might have questions about eligibility criteria, documentation, or repayment terms. Union Bank’s staff are there to assist you every step of the way.

Quick Approval

A bank has to be swift in processing loan applications. Whether your loan application is accepted or rejected, should be known to you as soon as possible.  Union Bank understands the urgency of securing funding for your overseas education. Students can expect a decision on their loan application within 2 weeks of applying. 

Reputation and Reliability

You need a reliable banking partner. Be it for a savings account, a home loan, or an education loan for studying abroad, the bank must be trustworthy and dependable. Union Bank of India has a long-standing reputation as a trusted financial institution. By choosing Union Bank for your study abroad loan, you can rest assured that you are partnering with a reputable lender.

In the next section, we’ll demonstrate a Union Bank education loan interest rate calculation.

Union Bank education loan EMI calculator

Let’s say you take a loan of ₹ 20 lakhs and it has 10% interest. You want to pay it back in 15 years.

The formula used is:

EMI = [P x R x (1+R)^N]/[(1+R)^N-1]

Where P = Principal, R = Rate of Interest, and N = Tenure in Months.

Thankfully you can use the EMI calculator from Union Bank of India.

Just input P, R, and T and you can check the EMI you are expected to pay.

Also read: 5 Cheapest Universities In The USA For Indian Students — Tuition And Living Costs

Documents required for securing a student loan from Union Bank

When applying for an education loan from Union Bank of India, you’ll need to provide quite a few documents.

Here’s a comprehensive list:

Document Type	Description
Academic Records	Mark sheets of 10th, 12th, and Graduation (if applicable)
	Entrance exam results
Admission Proof	Offer letter, admission letter, or ID card (if available)
Course Expenses	Schedule of expenses for the course
Scholarships and Free-ships	Copies of documents confirming scholarships or free-ships
Photographs	Passport-size photographs of student, parent, co-borrower, and guarantor
Co-applicant/Guarantor Documents	For salaried individuals:
	Latest salary slip
	Form 16 or latest income tax return (ITR)
	For others:
	Business address proof (if applicable)
	Latest income tax returns
Identification Documents	Permanent Account Number (PAN) of student
	Aadhaar card
	Passport (mandatory for studies abroad)
	ID Proof: PAN card, Passport, Aadhar Card, Voter ID card, Driver’s License
	Age Proof: PAN card, Aadhar Card, Passport, Birth Certificate, Bank Passbook, Driver’s License
	Address Proof: Aadhar Card, Voter ID card, Driver’s License
Collateral-related Documents	Title deed of house, property, or document showing ownership of asset

Things to remember when applying for Union Bank education loans

When applying for Union Bank of India education loans, keep the following important points in mind:

Eligibility Criteria

Are you at all eligible for a loan? Union Bank of India education loans are available for a variety of courses and different education institutions. Do you meet those criteria?

Factors include academic performance, course type, and admission to recognized institutions.

Loan Amount and Margin

Determine the loan amount you need. Consider tuition fees, living expenses, and other costs.

Be aware of the margin (percentage of the total cost you need to fund yourself) required by the bank. For Union Bank loan products, the margin is 12%, which means you can get the remaining 88% of the required amount sanctioned as loan. 

Tenure 

Consider how long you will need to repay your loan. When you opt for a longer repayment period, you can reduce your monthly payments. However, this also means you will end up paying significantly more interest. For example, choosing a 15-year repayment plan over an 8-year plan means you will pay nearly 50% more in total interest.

Moratorium Period

The moratorium period on the loan is the time during which you are not required to make any loan repayments. This period typically covers your years of study and any subsequent internship, or a grace period of 6-12 months after you complete your course. This flexibility means that students won’t need to start repaying the loan until they begin earning.

Also read: Student Loan For Study Abroad – 10 FAQs, Answered By Experts

Collateral rules for Union Bank education loans

There is no specific information about collateral rules for Union Bank education loans. It would depend on your academic record and financial status.

Education loans can feel overwhelming. There is so much to consider such as interest rates, moratorium periods, and tenure. Finding the right lender, visiting banks, and repeatedly submitting paperwork can be tiring.

Don’t worry. Head over to FundRight.

FundRight is a state-of-the-art AI-enabled platform. It is designed to assist students like you secure education loans easily.

Here are the easy steps to get you started. 

1. Register on our platform today
2. Create a profile
3. More than 15 banks and NBFCs will vie to offer you loans
4. Our experts will guide you
5. Upload your documents
6. Your loan will be approved in a week

Gone are the days of reaching out to multiple agents and bank reps.

FundRight can cut down on that repetitive work, and get you loan offers in just 2 days. Apply today.

Also read: Should You Use ChatGPT To Write Your Statement Of Purpose (SOP)?

FAQs for Union Bank Education Loan