Towns a study in aspirational borrowing as overseas education calls
education is sweeping small towns across the country, spurring demand for study loans and underscoring the burgeoning ambitions of young Indians. Guntur, Rangareddy, Krishna, Surat, Prakasam, Warangal, Visakhapatnam, Ludhiana, Nellore, Patiala, Amravati, Bijnor, Medak, Ajmer, Bhilwara, Churu, Darjeeling, Mahbubnagar and Nalanda are among towns that have seen the most applications for education loans in 2023, according to lenders whom ET spoke to.
As much as 70-72% of the students funded by Avanse Financial Services in 2023 belonged to tier II-III and beyond, said the education-focused nonbanking financial company’s managing director and chief executive, Amit Gainda.
He attributes the growing demand to aspiration among youngsters from the hinterlands to access foreign education and have a better standard of living.
Study abroad consultant Leverage Edu’s financial services platform Fly.finance recorded more than 50% jump in applications from tier II-III towns in 2023. This included applications from 147 new cities for the first time.
“In calendar 2023, we received 1.9 applications from small towns for every application from tier I city,” said Akshay Chaturvedi, founder and chief executive, Leverage Edu.
WHAT’S THE TRIGGER?
A variety of factors are influencing the trend.
These include emergence of new-age education-focused NBFCs, growing awareness of diverse financing options and perceived better career opportunities from holding a foreign degree. Rohan Ganeriwala, cofounder of study abroad consultant Collegify, said, “It reflects the growing ambitions of the Indian youth from the smaller towns and districts.”
“There is more awareness about the plethora of options — both in terms of universities and financing due to
