Education costs in Nepal are rising every year. This is making it harder for students to afford quality education. Many talented students are struggling to follow their dreams. As everything is expensive in the field of education. This is where education loans in Nepal become a lifeline for students and families.
Bank loans for students offer hope by providing the financial support needed for their international studies. Whether you want to study in Nepal or abroad. Banks now offer various loan options to help you achieve your educational goals.
In this guide, we’ll explore everything about education loans. From requirements to the best deals available. You’ll learn how to choose the right loan and understand interest rates. You will discover which banks offer the most affordable options for your studies.
What is an Education Loan?
An education loan in Nepal is money borrowed from banks specifically for studies.
Unlike regular loans, these have lower interest rates and flexible payment terms. Education loans cover everything you need for your studies. This ranges from tuition fees, living costs, books, and equipment.
Banks design these loans to help students. By helping them focus on learning without worrying about money during their studies.
Types of Education Loans in Nepal
Banks in Nepal offer different kinds of education loans to match your study plans.
- Domestic education loans help you study in Nepal at local colleges.
- International education loans help students study in other countries like Australia, USA, or UK.
Banks also give special professional course loans for doctors, engineers, and MBA students. So, whether you’re starting your first degree or going for higher studies. Banks have loan options that fit your needs.
Why Choose Bank Loans for Students?
Bank loans for students are better than other loans. Banks charge less money as interest, so you save money. They let you pay back in small amounts over many years, making it easier for you. The best thing is that you don’t need to pay anything while studying. As banks understand, students have no income during college. So they wait until you graduate and find work before asking for payments.
What are the Requirements for an Education Loan in Nepal?
Basic Eligibility Criteria
To get an education loan in Nepal, you must be between 18 to 35 years old. You need to be a Nepalese citizen or have permanent residence in Nepal.
Banks also check your school grades and previous study records to make sure you’re a trustworthy and genuine student.
Most importantly, you must get admission to a college or university that banks trust and approve. Only recognized schools qualify for education loans.
Documentation Requirements
For Students:
- You should provide all your school certificates and mark sheets
- A copy of your admission letter from the college
- The front and back of your citizenship card or passport
- At least 2 of your passport-size photos
- Course fee details
For Parents:
- Their job and salary proof
- Bank statements of your parents for the last 6 months
- House or land papers, if you own any
- If your parents own a business, then a business paper
- Their tax payment proof
Financial Requirements
- Your parents must earn enough money to pay back the loan
- Banks need something valuable, like land, a house, or bank savings collateral
- Families usually pay 10-20% the total fees from their own money first
- Banks check that families don’t have too many other loans already. So, clear that if that’s the case for you
- Your family’s monthly income should be higher than the monthly loan payments
Institution Requirements
- Banks only give loans to good colleges and universities that they trust
- Your course must be approved and real, not fake programs
- For studying abroad, banks check if the foreign school is genuine and famous
Which is the Cheapest Education Loan?
Current Interest Rate Information (2025)
Right now, education loan interest rates in Nepal range from 8.86% to 14.09% per year. Different banks charge different amounts based on several factors.
Banks look at your family’s income, what valuable things you own, your school grades, and which bank you choose. Each bank has its basic rate, and then it adds an extra percentage on top. The final rate depends on how risky banks think your loan is.
As every bank has its Unique selling points, down below are the banks with very competitive offers.
Best Banks with Good Rates
- NIC Asia Bank: They give easy payment plans and are flexible with students
- Nepal Investment Mega Bank: You can loan up to 1 crore rupees from them
List of Top banks and their rates and features about education loans
| Bank Name | Maximum Loan Amount | Interest Rate Range | Moratorium Period | Repayment Tenure |
| NIC Asia Bank | NPR 10 million | 10.5% – 13.5% | Up to 5 years | Up to 20 years |
| Nepal Investment Mega Bank | NPR 10 million | 11.30% – 16.30% | duration of the course plus six months | Up to 15 years (including moratorium period) |
| Everest Bank | NPR 35 Lakh | Market rates | Course completion + 6 months | Up to 7 years |
| Siddhartha Bank | NPR 10 million | 9.7%10.25% | up to 1 year or the course duration | Up to 15 years |
| Kumari Bank | NPR 10 million | 8.8% 10.8% | ———– | Tenure up to 15 years |
| Prabhu Bank | Around NPR 1 crore | 6.65%) + 3.00% to 5.00% = 9.65% to 11.65% | up to 4 years | up to 15 years |
| Global IME Bank | Around NPR 1 crore | 11.99% 12.99% | up to 1 year post-completion of the course. | Up to 5 years |
| Himalayan Bank | 10 million | Premier Education Loan: Non Revolving 7.24% to 9.24%, Revolving up to 8.74% – Standard Education Loan: Non Revolving 9.24% to 10.74%, Revolving 8.74% to 10.74% – Fixed Rate (up to 7 years): 9.50% | Up to 15 years |
What Makes Interest Rates Higher or Lower
In the context of education loan interest rates in Nepal, many factors affect your rate
- What you give as collateral (land costs more than house, house costs more than bank savings)
- How much money do you want, and how long it take to pay back
- How strong is your academic performance (better grades mean lower rates)
- How much your parents earn, and if they paid off other loans on time before
- If your family already banks with them (old customers get better deals)
Application Process and Timeline
Step-by-Step Application Process
- Initial consultation
Visit banks to discuss your education loan options. Select the best one according to your needs. - Document preparation
You must collect and organize all required papers for verification by the bank. - Application submission
Submit your complete student loan application for processing. - Property valuation
The bank evaluates your collateral if you’re using property as security. - Loan approval
Receive your sanction letter once approved. - Disbursement
The bank releases bank loans for student funds directly to your institution.
Expected Timeline
- Approval application
Getting your education loan in Nepal approved takes 2-4 weeks. Banks need time to review everything. - Document verification
Banks check your student loan papers in 3-7 days to make sure they’re correct. - Property valuation
If using property, banks take 1-2 weeks to see how much it’s worth. - Final disbursement
Once approved, bank loan money reaches your school in 1-2 weeks. - Total time:
The whole process takes 4 – 8 weeks from start to finish.
Repayment Terms and Conditions
Moratorium Period Benefits
- Maximum 5 years
Your education loan in Nepal doesn’t require full payments while studying. You have to pay it up after a total of 5 years or 6 months after finishing. - Interest-only payments
Pay only interest during studies, not the main loan amount. - Grace period
Get extra time to find a job after graduation before starting full payments.
Repayment Options
- EMI payments
Pay fixed monthly amounts that include both principal and interest for your student loan. - Flexible schedules
Banks offer different payment plans based on your income capacity. - Prepayment allowed
Pay early without extra charges to reduce the total interest. - Loan restructuring
Modify terms if you face financial difficulties.
After Graduation
- Employment check
Banks verify your job to calculate affordable payment amounts. - Income review
Your salary determines the monthly bank loans for students payment capacity. - Schedule adjustment
Payment plans change based on your actual earning ability.
Tips for Securing the Best Education Loan Deal
Research and Comparison Strategies
- Compare multiple banks
Check different banks offering education loans in Nepal to find the best interest rates and terms. - Negotiate rates
Use your existing banking relationship to get better deals on your student loan. - Consider total costs
Look at all fees, not just interest rates; this helps you to understand the real cost. - Check service
Choose banks with helpful staff who support you throughout the process.
Building a Strong Application
- Good grades
Maintain excellent academic records to show you’re a responsible borrower. - Clear goals
Explain your career plans to banks so they understand your earning potential. - Complete documents
Provide all required papers properly, and make sure they are organized and verified. - Strong guarantors
Choose parents or relatives with stable income and good credit history.
Common Mistakes to Avoid
- Poor research
Don’t rush into the first bank loans for students offer you receive. - Hidden costs
Read all terms carefully to avoid surprise charges later. - Incomplete papers
Prepare all documents properly to avoid delays in approval.
Conclusion
Getting an education loan in Nepal needs good planning and smart choices. You must understand interest rates and pick the right bank.
Always research well before choosing bank loans for students. Compare different banks, get all your papers ready, and know how to pay back the money.
This process can be confusing, so don’t do it alone. If you need any guidance on an education loan, service is provided in our Motif consultancy. We give you expert advice to find the best loan for your studies. Contact us today for personal guidance with your student loan needs.
