All about an education loan for Nepali students

If you’re a Nepali student looking to study in the U.S. or Canada, finding the right education loan is crucial. With high tuition fees and living expenses, securing a loan is often a necessity, but it’s not always straightforward. Nepali students face unique challenges, from limited access to government loans to requirements for cosigners and complicated application processes. In this article, we break down your loan options, key factors to consider, common mistakes to avoid and how to navigate the process of funding your education successfully.

1. Total number of Nepali students in the U.S. (2024):Nepali students now form a significant international student group in the U.S., with a record-breaking 32,788 students in 2024. This surge reflects a growing trend of Nepali students seeking world-class education and better career opportunities in the U.S.Source: U.S. Department of Homeland Security, SEVIS by the Numbers
2. Year-over-year growth – Nepali students in the U.S. (2023-2024):The number of Nepali students in the U.S. increased by 42% in just one year, from 23,043 to 32,788 students. This is one of the highest annual growth rates among all countries, showing a clear shift in global mobility trends for Nepali students.Source: U.S. Department of Homeland Security, SEVIS by the Numbers
3. The proportion of Nepali students among all international students:Nepali students now make up 1.5% of the total international student population in the U.S., with Nepal ranking as the 10th largest sender of international students globally. This represents a significant achievement for Nepal in international education.Source: Institute of International Education, Open Doors 2024 Report

Education loans for Nepali students are designed to help cover the cost of tuition, living expenses and other school-related costs. Since Nepali students don’t typically qualify for U.S. or Canadian federal aid, private loans, institutional loans or loans from Nepali banks are the most common options. These loans come from private lenders, universities or even Nepali financial institutions and require careful consideration of terms, rates and eligibility requirements.

1. Cosigner requirements

Many private student loans require a U.S. or Canadian citizen or permanent resident to cosign your loan, meaning they’re responsible for repayment if you default. This can be difficult for Nepali students who may not have connections in their host country. However, some lenders offer no-cosigner loans, typically for students in high-demand fields like STEM and who have strong academic performance.

2. Student loan interest rates

Interest rates on student loans can vary greatly. It’s important to understand the difference between fixed-rate student loans, which remain the same throughout the life of the loan, and variable rates, which fluctuate with market changes. Fixed rates provide stability, while variable rates may offer lower initial payments but carry the risk of increasing later.

3. Loan coverage

Not all loans cover both tuition and living expenses. When selecting a loan, you should make sure it covers all your financial needs, including housing, food, transportation and other essentials. Some loans are designed specifically for tuition, while others provide broader coverage.

4. Repayment terms

Check the repayment options and grace periods offered by lenders. Some loans allow you to defer payments until after graduation, which sounds convenient, but the interest still accrues and drives up the total cost of the loan. Consider lenders that may require immediate repayments because it reduces the total cost of the loan.

For many Nepali students, securing a loan is just one piece of the funding puzzle. Combining loans with scholarships, grants and part-time work can help reduce your reliance on borrowing, easing your financial burden in the long run.

• Search for scholarships: Many merit-based scholarships are available for Nepali students, and they don’t need to be repaid. Apply for as many as possible to reduce the amount you need to borrow. Look for scholarships specifically targeting Nepali students, as many universities and organisations offer country-specific opportunities.
• Explore grants: While less common, grants can provide funding based on your field of study or nationality. Check with your university and external organizations for grant opportunities. The Nepali government and several Nepali foundations also offer grants for students studying abroad.
• Part-time work: Depending on your visa, you may be eligible to work part time during your studies. U.S. student visas typically allow for part-time work on campus. This can help you cover living expenses without increasing your loan amount.

1. Overlooking no-cosigner options

Many Nepali students assume they need a cosigner to secure a loan, but that’s not always true. Specialised lenders cater to Nepali students without requiring a cosigner, focusing instead on academic potential and future earnings.

Solution: Research private student loans without cosigners early in your search to see if you qualify for these alternatives.

2. Ignoring the total cost of the loan

Many students focus solely on interest rates without considering the loan’s total cost, including fees, accrued interest during deferment and any penalties for early repayment.

Solution: Use a student loan calculator to estimate the true cost over the life of the loan and compare multiple lenders to find the best terms. And don’t forget to include additional fees like required insurance or foreign exchange fees when making payments between rupees and dollars.

3. Borrowing too much

It’s tempting to borrow more than you need, especially if the loan offers high limits. However, this can lead to unnecessary debt.

Solution: Calculate your exact financial needs based on tuition, fees and estimated living expenses, and avoid borrowing more than necessary.

4. Neglecting loan repayment planning

Many students overlook the importance of planning for repayment. Interest accrues even while you’re in school; if you’re unprepared, the debt can pile up quickly.

Solution: Understand the loan’s repayment structure, set a budget and consider starting small payments while in school to reduce interest accumulation.

MPOWER Financing is dedicated to helping Nepali students access the education they deserve without the traditional barriers that often come with securing funding. With loans specifically tailored for Nepali students studying in the U.S. and Canada, MPOWER makes it easier to finance your education and focus on what matters most – your studies and future career.

Here’s why MPOWER’s student loans stand out for Nepali students:

• Loans without a cosigner or collateral: Many Nepali students face difficulties finding a U.S.-based cosigner or providing collateral. MPOWER eliminates this barrier by offering loans that don’t require either, making education more accessible to students from Nepal.
• Comprehensive coverage of education costs: MPOWER’s student loans go beyond covering tuition. These loans can be used for essential expenses like housing, textbooks, meal plans and even health insurance, ensuring that students have the financial support to cover all aspects of their academic journey.
• Fixed interest rates with flexible repayment: MPOWER offers competitive fixed interest rates on loans ranging from US$2,001 (NPR 2,74,000) to US$100,000 (NPR 1,37,00,000), giving students a clear view of their repayment schedule. Students can also benefit from a 0.25% interest rate discount with auto pay, providing additional flexibility when managing loan repayments.
• Fast and simple application process: Applying for an MPOWER loan is easy and fully online. With a quick eligibility check and efficient approval process, Nepali students can secure the funds they need without the hassle of lengthy paperwork or complex procedures.
• Holistic support beyond financing: MPOWER understands that Nepali students need more than just loans to succeed. Through the Path2Success program, students gain access to career services, visa support and exclusive discounts on travel and textbooks, helping them thrive both inside and outside the classroom.