What are the benefits of non-collateralized loans?


You might have heard that getting an abroad education loan is a difficult task. Well, that’s not the case with non-collateral loans. For a non-collateral loan, you don’t need to put up your property, insurance, or bonds as security to get your loan approved. It can be offered to an applicant without any security. In comparison to a collateral loan, which is quite complicated and time-consuming, non-collateral loans are easy to get.

Non-collateral loans have made it easier for students to pursue their dreams of education abroad without any mental stress from financial shortages. The complicated process of collateral loans forced many students to settle in India or choose an Indian university. However, with non-collateral loans, it's now possible for students to reach their goals without making any compromises on their dreams and stay stress-free at the same time.

Education Loan Guru understands that there will be multiple questions in students' minds who wish to apply for the non-collateral abroad education loan; don’t worry, we will guide you.

We have outlined the benefits of applying for a non-collateral loan below:

Time Saviour: 

Applying for a non-collateral loan will save the applicant time and effort, as non-collateral loans are free of loads of paperwork and do not include any time-consuming activities. If you are applying for an education loan abroad through Education Loan Guru, then you just need to fill out an application form for the loan. The team at Education Loan Guru will take care of the rest.

Easy to get approved:

Non-collateral loans are easy to approve. In India, mostly NBFCs such as HDFC Credila and Avanse approve or accept such kinds of loans within a short span of time. However, taking proper guidance from the Education Loan Guru is beneficial. As they have joined hands with reputed NBFCs, such as Auxilo or Avanse, it becomes less time-consuming.

On the lender’s behalf, we will pre-assess the student’s profile and application form for the lender and keep you updated until the loan disbursement.


Non-collateral loans are hassle-free because they do not require a complicated application process. The application procedure for non-collateral loans is comparatively easier than for collateral loans.

Quick Loan Sanction: 

Non-collateral loans are quick to approve and take less time.

Since non-collateral loans do not require a longer verification process, it is easy and less time-consuming to get hold of loans. However, the applicant’s profile turns out to be the deciding factor in the approval of the loan. Once the bank or NBFC has approved the loans, students can expect to get the loans sanctioned within a few days.

No mental stress

Students who are applying for non-collateral loans can expect to get their loan sanctioned without any stress. Since non-collateral loans do not require a mortgage, like your property or others, if we take the case of public banks, then they offer 7 to 8 lakhs to students on a non-collateral basis. On the other hand, it has also been seen that the number of applications rejected by public banks is also high.

Similarly, if students apply for non-collateral loans through NBFCs, they can benefit. NBFC offers beneficial schemes for non-collateral loans with flexible repayment options so that students can focus on their education without getting stressed about repaying their debt all the time.

Student-Friendly loans:

Non-collateral loans are student-friendly, especially for those who have a low budget but still aspire to study abroad. Students can apply for non-collateral loans without stressing about their limited financial resources. Based on the student’s profile, loans can be disbursed even before admission. Students can also avail of top-up loans.

Interest rates:

NBFCs generally provide non-collateral loans with a rate of interest of around 10 to 14%. However, because there are so many variables that can affect interest rates, including the amount of loan the applicant needs, the co-applicant's profile, and many others, they fluctuate.

No Pre-payment Penalty:

Non-collateral loans are easy when it comes to payment options. There are candidates who prefer paying early for their loans. However, public banks might charge a penalty for pre-payment, but many NBFCs offer no pre-payment penalty.

Flexible repayment options:

When it comes to repaying a loan, non-collateral loans are considered to be an easy option. Most of the lenders offer flexible repayment options to students. However, students are also provided a moratorium period in which they are not required to pay any EMI. 


Students must provide essential documentation when applying for non-collateral loans. Unlike collateral loans, non-collateral loans offer greater flexibility and require minimal documentation.


In conclusion, non-collateral loans have emerged as a game-changer when it comes to education loans, especially for students aspiring to study abroad. These loans offer a lot of benefits that have revolutionized the way students approach their dreams of international education. The streamlined application process and the collaboration between education loan experts like Education Loan Guru and reputable NBFCs ensure that students can save valuable time and effort.


By Education Loan Guru