Reducing

Emotional and
Economic Burden
of loan on Students
Pursuing Higher
Education
“You’ve got the grades
Now, get the finance!”
 Stakeholders
Social
Media
Banks

Healthcare Parents
Students
Relatives
Student
Employers
Education
Loan Friends

Lifestyle
Roommates Educational
Neighbours
Institute
Recent
trends Teachers
Pain Pyramid
Gain Pyramid
 Primary Research
HDFC ICICI SBI CBI IDBI AVANSE
LOAN ₹10L (Nominal) ₹20L ₹20L ₹10L (For tier ₹10L ₹1L (min)
AA college)
COLLATERAL None till ₹7.5L None till ₹4L No collateral till ₹4L – 7.5L Third No collateral till Yes
₹2L party security ₹4L

MARGIN 5% above ₹4L 5% above ₹4L None 5% above ₹3L 5% above ₹4L None
TENURE 10 – 15 Years 15 Years 10 Years 15 Years for 10-15 Years 10 Years
above ₹7.5L
ELIGIBILITY Depends on Students who No eligibility 50% in Secured Indian citizen
college have secured Qualifying admission in above 10 Years
admission exam University
approved
college
 HDFC ICICI SBI CBI IDBI AVANSE
SERVICE 1% processing None None None None 1 – 2%
charge

TRANSPARENCY Yes Yes Yes Yes Yes Yes

INTEREST RATE 9% to 12% 11% and above 9.25% base rate 11.5% for Girls 13.5% interest 12.75%
12% for boys rate

OTHER Insurance cover, Insurance Insurance cover Caution deposit, Insurance cover 1 day loan
INCLUSIVE Exam fees, cover (Add interest, Study tour sanction,
travel expenses Cost of two- Doorstep
wheeler) service

THIRD PARTY Yes Yes No Yes None No

LATE PAYMENT 24% on overdue Depends on 2% increase in 24% on overdue 2 17

FEE amount loan interest
 • 100% College Tuition Fees payable + accommodation if
applicable.
Primary • Courses covered under the loan taken for a full-time,

Research part-time or vocational course and graduation or post

graduation in the fields of engineering, management,
medical, hotel management, architecture, etc.
• Up to 4 lakhs, no collateral or third-party guarantee.
• College value and confirmed admission.
• Different banks and NBFCs offer varying rates of
interest.
• Moratorium period of 6 months to one year after
successful course completion.
• Eligibility, documents required.
• Interest rate range is between 1.35-3%.
• Education loan helps in building a good credit score as
this is the first loan in a person's life.
Problems • No standard procedure for Loan in different banks
identified after studied in terms of details, information collection and
the process.
primary • Lack of Information.

research • Different rules and regulations.

Secondary • Students review on existing bank processes.
• Challenges faces by students while going through loan
research process.
• Personal interview of students who applied for
education loan.
• Survey – what changes students want in existing banks
loan process.
 In a survey of 12 questions which were based
on the issues identified in the primary research,
the following data was found.
The sample size for this survey was 20.
SBI is the most preferred bank.
Choice of Banks
12

10

0
State Bank of India Central Bank of India IDBI PNB HDFC Avanse
 Reasons for picking up the respective banks.

Reasons

Zero repayment charges

Parent's choice

Reasons

Based on reviews and suggetions

Better interest rates

0 2 4 6 8 10 12
Is the loan a Financial Burden
No Yes Maybe
financial
burden to you 21%
26%
financially?

53%
If there was an alternative scheme of working for NGOs/Companies (say 4 hours a week) which
would in turn pay your interests, thereby giving you experience as well as reducing your financial
burden, would you take it up?

Students response to taking up the job model

Maybe
6%

Yes
94%
How Loan decision process works?
Offers for
students Loan
Approach

Data
Analysis and
suggestions

Data collection from various

banks
Apart from financial burdens, students
also go through EMOTIONAL STRESS
throughout the process as well during
the loan period.
How loans actually effect
students psychologically?
Students lose sleep.

Their expenses are suddenly too calculated.

The exam performance comes down because their all energy is focussed on high
loans.

There is unhealthy competitiveness among students.

Over working to achieve more which generally backfires in terms of health.

Future plans becomes ambiguous.

During placements, the desperation level is way too high.

 What is the reason for these
Financial and emotional stresses
on the students?
 Unlisted and extra
list of documents The terms and
required during conditions and
verification. the overall
transparency.

Fixed loan
structure for
Lack of information tiered colleges
and difference in classified.
the same available
on different
sources.
What can be the Solution for these issues?
Information
of education
loan
providing
banks

Freelancing/
part time Online Interest
job search coaching rates
and website/app compared
availability

Interaction
with people
who have
taken
certain loan
from that
bank
 Information
a nd through online Provide data
ng Banks
y zi coaching
n al n g app/website
g , a ulti
c tin ons
lle c
Co

Pro
v
ide

h
inf

ac
o

ro
Online

rm

p
ap
ati
coaching

an
o
website/app

Lo
Platf
o rm fo
r pre
parat
io n
Offe
rs
Student
 Findings for the
proposed Solution
% of students doing Freelancing

Strongly agree
Agree
Neutral
Disagree
Strongly Disagree
% of job sectors available

Content Writing
Marketing
Web Designing
Accounting
Translation
% of people with no. of years of experience

No experience required(only
skills)
1-2 yrs of experience
2-5 yrsof experience
5-10 yrs of experience
% of jobs requiring physical presence

Physical Presence
No Physical Presence
Source Job Offered Office/Home Experience
Flexjobs.com • Hindi Trainer • Office (Mumbai) • 2 years
• Personalised Internet • Home • Entry level
assessor
• Caves coach specialist • Home • 5+ years
• Enterprise implementation
Manager • Office (Mumbai) • 3 years
• Software engineer

• Office (pune) • 5 years

Freelancer.in • Website design in XD • Home • Freelance

• Spring boot Dev
services :Oracle • Home • Freelance
• Stats & Probability expert
• Document writer • Home • Freelance
• Mobile app development
• Photography • Home • Freelance
• Videography • Home • Freelance
• Home • Freelance
• Home • Freelance

Designhill.com • Graphic design • Home • Freelance

“The GREATEST weapon AGAINST
Stress is our ability to choose
One thought over another.”
Thank You.