Education Loan to Study Abroad from Nepal: Collateral, Documents and Cheapest Banks
For most students leaving Nepal, the education loan does two jobs: it pays the fees and it proves to the embassy that you can.
- Nepali banks fund tuition and living costs abroad, usually against collateral (land, a building or a fixed deposit).
- The loan letter also serves as financial proof for the university and the visa.
- Rates follow the usual base rate + premium pattern; today's lowest are below.
- Ask about a grace period during study and about paying off early once you earn abroad.
How a study-abroad loan works
You apply with your admission letter and the cost of study. The bank lends against collateral, usually your family's land or house, or a fixed deposit, and a parent or guardian is co-borrower. Tuition can be sent straight to the university against its invoice, and the sanction letter goes into your visa file as proof of funds.
Today's lowest education loan rates
| Bank | Interest rate |
|---|---|
| Agricultural Dev. Bank | 4.55% – 6.55% |
| Prime Commercial Bank | 4.87% – 9.87% |
| Siddhartha Bank | 4.93% – 8.18% |
| Citizens Bank Int'l | 4.97% – 7.97% |
| Excel Bikas Bank | 4.99% – 8.99% |
| Rastriya Banijya Bank | 5.01% – 6.01% |
| Lumbini Bikas Bank | 5.46% – 9.46% |
| Shine Resunga Dev. Bank | 5.47% – 9.47% |
| Shangrila Development Bank | 5.57% – 9.56% |
| Himalayan Bank | 5.59% – 7.59% |
The first figure is the starting rate; most families pay somewhere in the range. See the full list on the education loan page.
| Tenure | Lowest starting rate (4.55%) | Median starting rate (6.18%) | Median top of range (9.05%) |
|---|---|---|---|
| 5 years | Rs 46,664 | Rs 48,542 | Rs 51,957 |
| 7 years | Rs 34,809 | Rs 36,737 | Rs 40,286 |
| 10 years | Rs 25,970 | Rs 27,982 | Rs 31,737 |
Documents you will need
- Admission or offer letter (CoE for Australia, I-20 for the US, CAS for the UK, or equivalent) and the fee estimate.
- Academic certificates and language test results.
- Citizenship of the student and the co-borrower.
- Income proof of the co-borrower: salary, business, rent or remittance.
- Collateral papers: lalpurja, maps and tax receipt, and the bank's valuation.
Timing matters
Valuation and approval can take weeks, and visa files have deadlines. Start the loan process as soon as you have an offer. Some banks will issue a sanction letter early so you can show funds, and release the money only when fees are due.
Repaying from abroad
Some banks start the EMI immediately; others allow a grace period while you study and charge only interest. After graduation, many students pay off early from their earnings abroad, so check the prepayment terms. Send repayments through a cheap channel: the exchange rate matters more than the fee (see remittance rates).
Without collateral?
Collateral-free education loans are rare in Nepal and limited to small amounts. Some international lenders offer them for specific universities, but in foreign currency and usually at higher rates. Compare carefully before signing.
Frequently asked questions
How can I get an education loan to study abroad from Nepal?
Apply to a Nepali bank with your admission letter, fee estimate and collateral (land, building or fixed deposit), with a parent or guardian as co-borrower. The bank can pay tuition directly and issue a letter for your visa file.
Do I need collateral for a study abroad loan in Nepal?
Almost always. Nepali banks generally require land, a building or a fixed deposit worth more than the loan. Collateral-free options are rare and limited.
Can an education loan be used as financial proof for a visa?
Yes. A bank sanction letter for an education loan is commonly used as proof of funds for universities and embassies. Check the destination's exact requirements.
When do I start repaying a study abroad loan?
It depends on the bank. Some start the EMI immediately, others allow a grace period during study with interest-only payments. Ask before you choose a bank.
Rates and rules change. Byajdar is not a bank or a licensed adviser; confirm the current terms with the bank before you borrow.
Compare before you borrow: Compare education loan rates → Or get matched with Find My Bank →