Expenses Covered by an Education Loan

Tuition, hostel, travel, laptop, insurance, deposits and more — what banks finance and what they do not.

Updated 30 September 2026 · 8 lenders tracked

Lowest education loan rate

6.75%

Union Bank Education Loan

What you need to know

Under the IBA model scheme the loan covers the reasonable cost of completing the course, not just tuition. Expenses must be supported by the institute’s fee schedule or bills.

Usually covered

Fees payable to the college, school or hostel
Examination, library and laboratory fees
Travel / passage money for studies abroad
Insurance premium for the student borrower
Caution deposit, building fund or refundable deposit backed by institution bills (usually up to 10% of tuition for the course)
Books, equipment, instruments and uniforms
A computer or laptop at reasonable cost if required for the course
Other course costs such as study tours, project work and thesis

Usually not covered

Costs before admission such as application and test fees (some lenders reimburse)
Personal loans, gadgets or vehicles not required for the course
Costs above the institute’s published estimate without bills

Abroad costs in detail

Cost	How it is estimated	Usually financed?
Tuition and university fees	Per the I-20 / CAS / CoE or offer letter	Yes — paid directly to the university
Living costs (rent, food, transport)	University’s cost-of-attendance estimate or visa proof-of-funds amount	Yes — released in tranches to the student’s account
Travel (one-way/return airfare)	Economy fare	Yes (passage money)
Health insurance	Often compulsory (e.g. OSHC in Australia, IHS in the UK, university plans in the US)	Yes — insurance premium for the student is an eligible cost
Laptop and study equipment	At a reasonable cost, if required for the course	Yes
Caution / housing deposits	Refundable deposits supported by bills	Yes, within limits (typically up to 10% of tuition for the course)
Visa fees, SEVIS, application fees, tests	Pre-admission costs	Often not — some lenders reimburse; check
Books, study tours, thesis/project work	Per estimate	Yes
Currency buffer	5% – 10% for exchange-rate moves	Plan for it — loans are sanctioned in rupees

Frequently asked questions

Is hostel fee covered if I stay outside the campus?

Many banks cover reasonable accommodation costs outside the campus against rent agreements or estimates, within the overall limit.

For information and comparison only. Loan terms, rates and rules change — confirm with the lender and read the Key Facts Statement before borrowing.