For Indian applicants looking to pursue an MBA at a top business school abroad, the financial burden can be significant. However, various financing options are available, from school-based scholarships to loans from alternative lenders and Indian banks. This article outlines how applicants can strategically navigate these options, making their MBA more affordable and manageable.
Many business schools offer merit-based scholarships, which can significantly reduce the overall cost of your MBA. While the competition for these scholarships is tough, especially at top-ranked schools, applying to slightly lower-ranked schools can increase your chances of receiving a scholarship. Schools ranked between 20 and 40 often offer generous scholarships to attract high-quality applicants, including those from India.
Here are a few examples of schools that offer merit-based scholarships:
Applying to schools ranked between 20 and 40 can be a strategic move to increase your chances of receiving merit-based scholarships. These schools often offer more generous funding and financial aid packages to attract talented candidates, and their tuition fees are generally more affordable compared to top 10 schools. Additionally, many of these schools specialize in certain areas, such as finance, entrepreneurship, or international business, offering strong career opportunities despite being outside the top 10.
If scholarships don’t cover all expenses, loans from alternative lenders are a viable option. Companies like Prodigy Finance and MPower Financing offer loans to international students based on their admission to a business school rather than requiring collateral or a co-signer. These loans are based on the applicant’s future earning potential, the school’s reputation, and the applicant’s academic profile.
Prodigy Finance specializes in providing loans to international students without requiring collateral or a local co-signer. The loan amount can cover tuition and living expenses, with repayment beginning after graduation. Interest rates typically range from 7% to 13%, and terms are based on the school’s reputation and the applicant’s career prospects.
MPower Financing is another alternative lender offering loans to international students. Like Prodigy Finance, MPower does not require a co-signer, collateral, or credit history. The interest rates typically range from 7% to 12%, and the company provides funding for both tuition and living expenses. MPower is a good option for applicants from India who may not have access to a co-signer or collateral but can demonstrate strong academic credentials.
Indian banks offer loans for studying abroad, which typically require collateral or a co-signer. However, these loans tend to have lower interest rates compared to loans from alternative lenders. Below are some popular Indian banks that provide educational loans for international students:
Indian banks usually offer loans at a lower interest rate compared to alternative lenders, but they require collateral or a co-signer. This can make the process more accessible to those who have assets to pledge or a reliable co-signer. However, for students who do not have these resources, loans from Indian banks may not be a viable option.
While both Indian banks and alternative lenders like Prodigy Finance and MPower Financing offer loans for studying abroad, there are key differences in their terms and accessibility:
| Factor | Indian Banks | Alternative Lenders (Prodigy, MPower) |
|---|---|---|
| Loan Amount | Up to INR 1.5 crore (depending on the bank) | Varies, typically covers full tuition and living expenses |
| Collateral Required | Yes (property, FD, or other assets) | No collateral required |
| Co-signer Requirement | Yes (usually a parent or guardian) | No co-signer required |
| Interest Rates | 9.6% to 13% | 7% to 13% (Prodigy Finance), 7% to 12% (MPower) |
| Eligibility Criteria | Creditworthiness of applicant and co-signer, collateral | Admission to a school, no credit history required |
| Repayment Start | Typically after course completion | Typically after course completion |
While the cost of an MBA can be daunting for Indian applicants, there are numerous financing options to explore. Applying to slightly lower-ranked schools increases your chances of receiving merit-based scholarships that reduce tuition costs. In addition, loans from alternative lenders like Prodigy Finance and MPower Financing provide an attractive option for students who don’t have collateral or a co-signer. Finally, loans from Indian banks are a solid option for those who have the necessary assets but come with additional requirements for collateral and a co-signer.
By carefully considering these options, Indian applicants can develop a strategy for financing their MBA and ensure that they are well-positioned for a strong return on investment after graduation.
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