What are the best student loan options for Indian students planning to study in the USA?

Exploring student loan options, eligibility and application tips for Indian students pursuing higher education in the USA.

Pursuing higher education in the USA comes with significant tuition and living costs. Student loans offer an effective solution, empowering students to bridge the financial gap without relying solely on savings or scholarships. 

This guide explores the best student loan options, key factors to consider, and the steps to apply, helping you find the right financial support for your academic goals.

Loan options in India for students planning to study in the USA

Indian students have two main loan options when it comes to funding their education in the USA: secured and unsecured. Understanding how each works will help you choose the best option for your needs.

1. Secured loans (collateral-based)

    • What they are: Secured loans require you to provide collateral, such as property, fixed deposits or other valuable assets, as security.
    • Where they’re offered: These loans are commonly provided by banks (public or private) and financial institutions.
    • Considerations:
      • While secured loans may offer lower interest rates, they require significant assets, which not all students can provide.
      • The approval process can take longer due to collateral evaluation.

2. Unsecured loans (no-collateral)

    • What they are: Unsecured loans don’t require collateral, making them accessible to students without property or savings. These loans are increasingly popular among international students.
    • Where they’re offered: International lenders like MPOWER Financing specialize in providing unsecured loans tailored for Indian students pursuing education abroad.
    • Why they’re a great choice:
      • No need to pledge assets; no risk of losing collateral
      • Focus on your academic potential and future earning capacity, rather than existing financial resources

How to choose the right student loan?

Choosing the right student loan goes beyond interest rates. It’s about finding a financial partner that aligns with your educational goals and unique situation. Here’s how to identify the best loan:

Understand what the loan covers 

A good student loan should cover all major education expenses, including:

    • Tuition fees
    • Living expenses such as housing, food and transportation
    • Additional costs like health insurance, books and supplies

Ensure the loan amount is sufficient to avoid juggling multiple funding sources.

Assess the lender’s flexibility

Not all loans are created equal. Look for lenders that:

    • Offer funding without requiring collateral or a cosigner
    • Provide clear timelines for disbursement, ensuring your funds arrive on time
    • Provide fixed interest rates that ensure predictable monthly payments throughout the loan term, offering stability and peace of mind
      (Variable rates may initially seem lower but can fluctuate based on market conditions, potentially increasing costs over time)

Prioritize accessibility

Banks may require extensive documentation and collateral, which can complicate the process. In contrast, international lenders like MPOWER Financing simplify the process by:

    • Offering loans based on your potential, not your current financial situation
    • Supporting students through a fully online application process

Factor in added support

Some lenders go the extra mile with additional resources, such as:

    • Visa assistance to navigate the documentation process
    • Career services like job placement help or resume reviews
    • Tools to help build your credit history in the USA

Types of lenders available for Indian students studying in the USA

Type Examples Key features Loan amount
Indian banks SBI, HDFC, PNB Collateral-based loans with competitive interest rates Up to ₹1.5 crore (depending on collateral)
Indian private lenders Nonbanking financial companies  (Credila, Avanse) Both collateral-base and no-collateral loans available Up to ₹50 lakh (no-collateral); higher amounts with collateral
International lenders MPOWER Financing No collateral or cosigner required Up to US$100,000 (approx. ₹83 lakh)


Key differences to consider:

  1. Currency: Indian lenders disburse funds in INR, which may be subject to fluctuating exchange rates. International lenders provide funds in USD, aligning directly with your USA based expenses.
  2. Eligibility: Indian lenders typically require collateral or cosigners, while international lenders focus on academic potential and future earnings.
  3. Added benefits: International lenders frequently offer career guidance and visa assistance, adding value beyond just financial aid.

Comparing top lenders for Indian students studying in the USA

When selecting a student loan, knowing the specifics of what each lender offers can help you make an informed decision. MPOWER’s no-cosigner, no-collateral loans remove significant barriers, offering a clear advantage for international students seeking accessible and transparent funding.

Here’s a comparison of top providers for Indian students:

Lender Loan amount Interest rate Eligibility requirements Key features
MPOWER Financing US$2,001 to US$100,000 Starting from 9.99% (10.89% APR)* (fixed rates) No cosigner or collateral; evaluates future earning potential Disbursed in USD; tailored for international students; includes career and visa support services
HDFC Bank Up to ₹20 lakhs Starts at ~11.40% Requires collateral and income proof Sanctioned before admission; tax benefits available
SBI Global ED-VANTAGE Up to ₹1.5 crore Starts from 11.15% (above ₹7.5L) Collateral required for amounts above ₹7.5 lakhs Longer repayment period; low-interest rates for collateral-based loans
ICICI Bank Up to ₹1 crore 11.40% to 14.00% Requires cosigner or collateral Covers tuition, GIC costs, and accommodation
Avanse Financial Services Varies by course Floating rates; 1–2% processing fee Depends on course and institution; no collateral for smaller amounts Covers 100% of education costs, including GRE/GMAT fees


*This rate only applies until January 31, 2025

Need help covering the full cost of your education?

Explore MPOWER Financing’s no-cosigner and no-collateral student loans to cover the costs that scholarships might not.

How to maximize the value of your student loan?

Your student loan isn’t just a financial tool; it’s an opportunity to manage your funds wisely and focus on your education without unnecessary stress. Here are actionable strategies to make every dollar count:

1. Prioritize your loan for essential expenses

    • Use your loan to cover critical costs like tuition, housing and insurance.
    • For discretionary expenses like dining out or entertainment, consider using income from part-time jobs or internships.

Pro tip: Categorize your expenses into “needs” and “wants” to avoid overspending your loan amount.

2. Leverage discounts and student perks

    • Many lenders disburse funds directly to your university for tuition. Ask if your school offers early-payment discounts or waives late fees for timely payments.
    • Explore student discounts on software, transportation and groceries to lower everyday expenses.

3. Create a buffer fund

    • Allocate a small portion of your loan for unexpected costs, like medical emergencies or academic supplies, to avoid last-minute financial stress.
    • If unused, you can apply this fund toward your loan balance to reduce interest.

4. Take advantage of MPOWER’s added benefits

    • Career support: Access resume reviews, job search tools, and interview resources to secure better-paying internships and postgraduation opportunities.
    • Visa assistance: MPOWER provides guidance to help simplify the visa process, ensuring you meet documentation requirements and deadlines.
    • Credit-building opportunities: Making small, on-time, and consistent payments during school helps you build a U.S. credit history, paving the way for future financial independence.

These benefits ensure your loan serves as a bridge to academic and professional success, not just a financial tool. Check your eligibility in less than one minute.

5. Plan early for repayment

    • Begin researching your repayment options before graduation to avoid surprises.
    • Use MPOWER’s clear and penalty-free early repayment policy to save on interest if your financial situation allows.

Pro tip: Schedule regular check-ins to review your loan balance and progress toward repayment goals.

Securing the best student loan for your USA education

Choosing the right student loan is essential for making your USA education dream a reality. With a wide range of options, from secured loans offered by Indian banks to flexible, no-cosigner loans from international lenders, there’s a solution for every student.

By comparing lenders, understanding loan terms and planning strategically, your loan can go beyond financial aid – it can empower your academic and professional growth. 

For students seeking no-collateral, no-cosigner options, MPOWER Financing offers tailored support to help you succeed. Take the next step today and explore how MPOWER can help you achieve your USA education goals.

MPOWER Financing Student Loan

A loan based on your future earnings

FAQs

1. How do I calculate the total amount I should consider for studying in the USA?

To calculate the total cost, include:

    • Tuition fees for your program
    • Living expenses, including rent, food and transportation
    • Health insurance and academic supplies like books

Once you have the total cost, subtract any scholarships, savings or part-time income to determine how much you’ll need to borrow.

2. Do I need a USA based cosigner? What happens if I don’t have one?

Many traditional lenders require a USA cosigner for education loans. However, international lenders like MPOWER Financing offer loans without a cosigner, focusing instead on your academic potential and future earning capacity.

3. Are there any specific loan programs available for Indian students attending STEM programs in the USA?

Yes, some lenders cater specifically to STEM students due to their high earning potential after graduation. MPOWER Financing, for example, supports students in STEM programs by evaluating their future career prospects rather than requiring collateral or cosigners.

4. How can students find credible lender options?

Research online, check reviews and compare key features like interest rates, loan amounts and repayment terms. Consulting your university’s financial aid office can also help you identify reliable lenders experienced in working with international students.

5. What key questions should I ask my lender about their policies for international education loans?

    • Does the loan require a cosigner or collateral?
    • What are the interest rates and repayment terms, including fixed vs. variable rates?
    • Are there any hidden fees, such as processing fees, insurance or prepayment penalties?
    • How and when will the funds be disbursed?
    • Do you offer added benefits like visa or career support?

6. Who can I contact for assistance if there are delays or issues with my loan?

Reach out to your lender’s support team or your university’s financial aid office for guidance. For Indian students, international lenders like MPOWER Financing provide dedicated customer service teams experienced in addressing unique student concerns.

Ready to fund your education abroad?

Explore flexible, no-collateral student loans designed specifically for international students.

DISCLAIMER – Subject to credit approval, loans are made by Bank of Lake Mills or MPOWER Financing, PBC. Bank of Lake Mills does not have an ownership interest in MPOWER Financing. Neither MPOWER Financing nor Bank of Lake Mills is affiliated with the school you attended or are attending. Bank of Lake Mills is Member FDIC. None of the information contained in this website constitutes a recommendation, solicitation or offer by MPOWER Financing or its affiliates to buy or sell any securities or other financial instruments or other assets or provide any investment advice or service.

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