When Indian parents welcome their child in their family, few important things which always remain in the back of their minds are – prepare themselves for their educational expenses and marriage expenses. Securing a child’s future is one of the critical goals for most parents. Education has always been an important aspect of the Indian culture. Thus, as soon as secondary education is completed, parents encourage their children to pursue higher education to secure a brighter and promising future.

Financing education has become very expensive in the last couple of years. According to a report by the National Sample Survey Office, the average private expenditure for general education has increased by 175% between 2008 and 2014. As the economy and double-digit inflation took hold, college tuition and fees climbed rapidly to match or exceed inflation.

Nowadays, educational institutions offer a plethora of choices in terms of subjects, courses and degrees. Apart from the regular conventional courses such as STEM, MBA, institutions also provide a wide range of non-conventional courses such as aviation, music, animation and many more. The awareness on educational degrees have increased to a great deal which in turn amplified its demand and student’s aspiration to achieve them.

Hence, to give deserving students a chance, institutes are reinforcing strict measures to select candidates and high demand is contributing towards increased pricing. In such a scenario, parents consider liquidating their savings to help fulfil their children’s dream. But in reality, the ideal way is to opt for an education loan and reap the multiple benefits it offers.

Education financing is a multi-decade secular growth opportunity in India. This format of financing education helps both parents and students experience a hassle-free journey. The holistic cost of education starting from tuition fees to living expenses to equipment cost to insurance cost are all taken care by the financial institution. The student just needs to concentrate on his/her studies during the academic journey.

The borrowed money has to be repaid once the student gets a job. This in turn helps the parents keep their savings intact for the future. Thus, the hard-earned savings can be used for future contingencies such as medical emergency, uncertain times such as the one we all are facing currently and also, for their retirement phase.

These days’ parents are realizing these benefits and are encouraging their children to opt for an education loan. Education loans also enable students to secure the self-made badge which makes their parents proud. By opting for such a solution, parents in turn make their children more financially responsible. They realize the value for money and get into a habit of repaying from early days of their lives and thus, make their credit scores stronger.

Securing an education loan has become much easier these days as financial institutions are going beyond the traditional ways of assessing profiles. One such instance is that organizations like Avanse Financial Services take a student centric approach to analyze a student profile for granting an education loan.

Students’ past academics, entrance test scores, course selection and university/institute ranking are evaluated to analyze their employability potential. Post this, the co-borrowers profiles and collaterals are analyzed for loan. Hence, organizations are trying their best to make education financing seamless and affordable for every deserving Indian student.

New-age lenders are disrupting the sector and have introduced ways to better assess student’s capabilities. This has improved the overall loan sanction processes. Players such as NBFCs are thriving to collectively devise quicker and simplified solutions for education financing.

A quick example is the technology intervention under which a secured education loan can be processed in just a few minutes. With millennials willing to explore options to safeguard their savings and manage their expenses efficiently, age-old apprehensions over taking loans have evolved into pro-credit sentiment.