One of the biggest challenges students have before studying abroad is obtaining an education loan quickly. There are tight timelines for admission deadlines, visa applications, and tuition fees; it can be mask and have no stress when waiting a couple of weeks/months for your loan to come through. The pleasant news is that not all banks/lenders take the same time to process education loans, and some are faster than others to approve and disburse education loans.
In this blog, we will compare and contrast which banks/financial institutions take the quickest time to approve education loans using real student experiences and case studies. We will look at the differences between public sector banks, private banks and NBFCs; i.e. loan approval time-lines, the documents needed to expedite the process and which lender would best suit your profile should time be an important aspect.
Whether you have 60 days until your university deadlines or you only want to have peace of mind that your lender will get your money within a two-week timeframe, this blog will help you confidently select your lender.
What Is an Instant Education Loan?
An Instant Education Loan is a fast-track loan facility designed to provide education funding quickly often within minutes without the prolonged paperwork and multi-layered bank processes typical of traditional student loans.
Key Features & How It Works
Eligibility on Preset basis against Fixed Deposits
The eligibility on preset basis against Fixed deposits is an initiative pioneered by ICICI Bank, which enabled customers to auto-generate a sanction letter digitally for loans up to ₹1 crore (₹50 lakh for domestic courses), from Fixed deposits eligible, already held with the Bank up to 90% of their value.
Entirely Digital & Paperless
A borrower will view the pre-approved offers, select the loan amount and tenure, verify the student details, and he’ll receive the sanction letter instantly via internet banking or app, all with just a few steps
Speed & Convenience
The entire workflow from logging into the digital platform to approving the loan took just a few clicks, bringing down the time from days to minutes
FD-Backed Collateral
The loan will be secured against the borrower’s FD, which means no further collateral needs to be arranged, though the student will be required to submit academic documentation along with admission proof post sanction before the bank releasing the disbursement amount.
Loan Approval Speeds: Banks & NBFCs for Education Loans
Indian finance ministry has instructed public sector banks (PSBs) to provide education loans within within fifteen days of submission and establish centralized ways of dealing with credit processes, faster approval, and other such measures. PSBs are also expected to process any backlog of pending applications.
Non-Banking Financial Companies (NBFCs), like HDFC Credila consistently provide a better turnaround speed, heavily using internal scoring, and robust workflows. If you do not have sufficient time left for the university date or visa purposes, you may be better served to go through an NBFC not only for speed, but also sanction certainty é if you can obtain one. Below is a bank-wise comparison table for education loan approval speed.
| Bank / NBFC | Type | Typical Approval Time | Typical Disbursal Time | Notes |
|---|---|---|---|---|
| SBI | Public Sector Bank | 15–20 working days | Few days after verification | Government-mandated process; may take longer for large loan amounts |
| PNB | Public Sector Bank | 15–20 working days | Few days after verification | Standard PSB process; faster if documents are complete |
| Bank of India | Public Sector Bank | 15–20 working days | Few days post sanction | Quick for verified students with co-applicants |
| HDFC Credila | NBFC | 5–10 working days | 3–7 days after sanction | Streamlined processing; fast approvals for premium institutions |
| Avanse | NBFC | 5–10 working days | 3–7 days post sanction | Quick processing; minimal documentation delays |
| InCred | NBFC | 5–10 working days | 3–7 days after sanction | Uses internal scoring for faster approval |
Factors That Affect Education Loan Approval Speed
When it comes to education loans, approval speed can vary greatly depending on several factors. Understanding these will help you prepare better and avoid unnecessary delays.
Type of Lender
Public sector banks can often take longer due to the heavy documentation requirements and the multi-tier verification process. Private banks usually have better systems, so they can approve an education loan faster than a public, or NBFC. In general, NBFC’s (non-banking financial companies) are the quickest, as they can usually provide loan approval within a few days, and offer quicker paths to funding if the documentation is complete within a few days.
Completeness of Documentation
Having the documentation required, such as admission, academic background, co-applicant income, and bank statements, can only benefit getting quicker processing of the education loan. The majority of the time processing takes longer because the banks a) misplace the document, b) the documents were incomplete/ unclear in nature
Applicant’s Profile
Your academic record, entrance exam scores, ranking of the University you are attending, and course you are taking, are all important factors that can contribute to how quickly the education loan gets approved. If you have a good academic and financial profile, increase the likelihood of a quicker approval.
Credit History of Co-Applicant
The majority of education loans (especially non-collateral), are reliant on the performance of the co-applicant, so the CIBIL score, repayment history, and financial standing of the would sometimes determine how quickly the bank will approve the loan. If they have a bad credit profile, there is a great chance that the education loan will be slowed down, or worse, rejected.
Loan Amount and Collateral Requirement
In terms of amount of credit, loans with less amounts (unsecured loans) will typically get approved the quickest, whereas larger loans with secured collateral typically take longer as banks are required to take property values, legal checks, and verification.
Internal Processing Speed of Bank/NBFC
Each lender has different policies and levels of bureaucracy in approving your education loan. Some lenders utilize technology or rely on centralized processes to approve loans quickly, but there are others that rely on traditional methods and levels of approval.
Time of Application
Loan approvals can be slower during peak admission seasons (May–August) when banks face a rush of applications. Applying early or with a lender known for faster turnaround can help avoid delays.
Tips to Get Your Loan Approved Faster
To shorten the time between applying and getting your education loan approved, you must be well prepared, transparent, and meet all requirements before applying for the loan.
First, a good academic record combined with proof of admissions at a recognized institution, is always a wise idea as lenders will use these records to assess your ability to repay your loan.
Second, ensure that you fill out all the documents correctly if possible, which will include international student ID, address proof, academic certificates, income statements of the co-applicant and any requirement relating to the collateral, if applicable.
Third, ensure that you apply to the right lender, if possible, as NBFCs and private banks tend to process loan requests faster than public sector banks. Speed always depends on submitting to the lender known to have a faster loan processing time.
Fourth, if you have a co-applicant, ensure their credit score is good with stable monthly income, as the co-applicant profile is a major consideration when looking at non-collateral loans.
Fifth, it is vital to clarify your needs from the get go: how much you need, what the intention will be regarding repayments and if you want some moratorium period; communicating your needs clearly should minimize delays.
Finally, be proactive in ensuring you follow up with the bank or nbfc after submission so that you will begin addressing any questions or any additional documentation as soon as possible and facilitate your needs getting through the verification and sanctioning processes.
Which Bank or NBFC Should You Choose?
Selecting the right bank or NBFC for your education loan is important for quick approval, low-interest rates, and easy repayment experience. Public sector banks like SBI or Punjab National Bank usually have lower interest rates along with longer repayment tenure, reasonable and easy customer service, and thus could be the best option for students concerned about cost and credibility.
The approval process may take a long time given the thorough verification process. Private banks for example HDFC, ICICI, Axis Bank have a mix of reasonable interest rates and are generally quick in processing the loan but leave it to the students to manage the outcomes since they primarily focus on students with a good academic and financial profile.
NBFCs and education loan providers such as HDFC Credila, Avanse, InCred are good at fast approval, attractive eligibility criteria, and handholding students which makes them a viable option for students with an urgent disbursal or needs for loans for non-traditional or foreign universities. Ultimately, the choice will depend on how much money you require, how much collateral you can provide, speed of processing the application, interest rates, and the financial profile of your co-applicant. Comparing loans will allow you to choose a lender that fits your education financing needs with minimum delays and minimal hassles.
FAQs: Which Bank Approves Education Loan Fastest?
Q. Which banks provide the fastest education loan approvals?
A. Private banks like HDFC, ICICI, and Axis and also specialized NBFCs like HDFC Credila, Avanse, and InCred usually sanction education loans faster than public sector banks.
Q. What is an instant education loan?
A. An instant education loan is usually a pre-approved or fast-track loan that can sanction in minutes or within few days as it depends on the borrower’s eligibility and the documents he/she submitted.
Q. Can I get an education loan approved without collateral?
A. Many banks and NBFC’s provide loans for education with no collateral but up to specific limit, especially if the student has good academic record and has a credible co-borrower.
Q. How long does it take for an education loan to get approved?
A. Loan processing can take in between (for instant loans) a few days to 2-4 weeks depending on the lender, type of loan, and the overall completeness of submitted documents.
Q. Does having a co-applicant speed up the approval process?
A. If there is a stable income and good credit history on behalf of a co applicant lender will have more confidence and process the sanction quicker.
Q. What factors affect the speed of loan approval?
A. Multiple factors affect the speed of education loan approval such as academic profile, co-borrowers income and credit score, overall completeness of documents, type of institution/course, and lender policy.
Q. Do NBFCs approve loans faster than banks?
A. NBFCs and private education loan providers have more flexible processes and quicker verification, though interest rates may be slightly higher.
Q. Can online applications speed up the approval process?
A. Submitting an online application with required documents will minimize paperwork and speed up verification / sanction.
Q. What documents are essential for faster approval?
A. Having identity proof, address proof, academic records, admission letter, fee structure, income proof of co applicant & bank statement, all will mean speedier approval.