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Okay, so you are planning to do an MBA from a top business school such as Harvard in the US, INSEAD in Europe, or ISB in India. You are fairly confident of cracking the GMAT, and you feel that your profile is good enough to get a foot in the door for the interview. However, you are still worried about the ROI of an MBA! You have read that a two-year MBA can cost upwards of a crore! That is 10000000! Heck! you can’t even count the zeros without putting your finger below the text. If you are wondering how to fund your MBA abroad when you don’t have that much money in the bank (of course you don’t), you have come to the right place. In this e-book, we are going to cover a LOT of ways in which you can get loans and scholarships to fund your MBA. By the end of this e-book you will know exactly what to do.
6 main ways to Finance your MBA 1. Non-cosigner Loans Given by the MBA Program
2. Non-collateral Education Loans by Indian Banks
3. Non-collateral Education Loans by Non-Banks/Specialized Institutes
4. Self-finance
5. Soft Loans
6. Scholarships
7. Collateral Loans in India
8. Co-signer Loans in the US
1. Non-cosigner Loans Given by the MBA Program There are a good number of US B-schools offering student loans without a U.S. cosigner. This means that the B-school itself will stand as your guarantor. Here is a list of schools in the US that offer a non-cosigner loan in India: A. Harvard Business School Harvard University Employees Credit Union (HUECU) provides private educational loans to international students with no co-signer. For more details visit: http://www.hbs.edu/mba/financial-aid/internationalstudents/Pages/default.aspx B. Stanford Global School Of Business Stanford GSB works with Prodigy Finance and Star One Credit Union to provide loan options for international students. To know more: https://www.gsb.stanford.edu/programs/mba/financialaid/international-students C. Wharton School of the University of Pennsylvania Wharton has a new partnership with Quorum Federal Credit Union that will provide a non-cosigned loan up to 80% of the MBA Course fee for incoming international students. For more details: https://mba.wharton.upenn.edu/tuition-financial-aid/ D. Cornell University Johnson has partnered with QUORUM Federal Credit Union to offer a no co-signer loan at a competitive rate to International students for their full-time two-year MBA and one-year MBA programs. For more details: http://www.johnson.cornell.edu/Programs/Full-TimeMBA/Admissions/Financial-Planning/International-Students
E. Duke Fuqua School of Business Duke Fuqua School of Business, in association with Discover Student Loans provides a no co-signer loan to eligible international candidates. This plan enables students to take a loan up to 80% of the total school-certified cost of attendance at an interest rate of 7.24% For more details, see: http://www.fuqua.duke.edu/financial-aid/internationalstudents/current-student-loan-no-cosigner/daymba-2018-loan-options/
F. Haas School of Business Haas School of Business, in partnership with Elements Financial and Discover Bank, provides a no co-signer loan up to $62,000 to eligible international candidates, with a 20 year repayment option. For more details, see: http://www.haas.berkeley.edu/finaid/MBA/internationalloans.html
G. Yale School of Management (SOM) Yale SOM has a student loan program for international students that does not require a U.S. co-signer. The program provides a maximum loan of 80% of cost of attendance with an interest rate varying from 6.5% to 9%, depending on a credit risk assessment. For more details, see: http://som.yale.edu/programs/emba/admissions/tuitionfinancial-aid/student-loans H. The Darden School of Business The Darden School of Business and the Darden School Foundation have signed a multi-year MBA Loan Program agreement with Discover Bank. The Maximum borrowing limit is $89,000 with a standard repayment term of 20 years. Learn more here: http://www.darden.virginia.edu/mba/financial-aid/loans/
I. UCLA Anderson UCLA Anderson has partnered with Elements Financial Finance to provide no cosigner loans up to $100,000 ($50,000 per year) for International students. Know more: http://www.anderson.ucla.edu/degrees/mba-program/admitcentral/financing-your-mba/financing-options J. Kenan-Flagler Business School Kenan-Flagler Business School has tied up with Credila to provide no co-signer loans exclusively for Indian students. For more details, see: http://www.kenan-flagler.unc.edu/admissions/mba/tuitionfinancial-aid/student-loans
K. MIT Sloan MIT Sloan provides no co-signer student loan funds for International students through the MIT Federal Credit Union, except for students from countries on the current OFAC sanctions list. Know more: http://mitsloan.mit.edu/mba/admissions/tuition-and-financial-aid/ You may have realized that not many of the top business schools have such tie-ups. This is because after 2008, (which was when the financial meltdown happened), banks became more wary of giving loans at low interest rates to international students. However, if you do get an admit to a school which has such a tie-up, it should be a no-brainer. Your entire fees get covered! What more could you ask for?
2. Non-collateral Education Loans by Indian Banks Almost all Indian banks work with the following rules: •
In India, you can easily get a non-collateral loan up to INR four lakhs.
•
For amounts up to INR 7.5 lakhs, the bank will assess the risk involved, before making the decision to grant the loan.
•
For any sum above INR 7.5 lakhs, you need to show collateral to the bank.a
The loans from India are either collateral, or non-collateral. Non-collateral loans may be offered against your admission to a top B-school, but typically, the maximum offered is somewhere near INR 10 Lakhs, while the norm is closer to INR 5 to 6 lakhs. If you look at collateral loans, they are granted against property that you mortgage. However, the upper limit could be very high, depending on what you have mortgaged. Following are some of the top banks which offer study loans by exceeding the limit of the loan without issues of collateral security:
Source: https://www.bankbazaar.com/education-loans-without-collateral.html
Here is the list of banks in India where you would get a non-collateral loan if you make it to ISB:
For more information, see http://www.isb.edu/pgp/fees-financing/loans
3. Non-collateral Education Loans by Non-Banks/Specialized Institutes Nowadays, many non-banking institutions provide unsecured loans, i.e., loans without pledging collateral, as typically, banks do not extend loans beyond 7.5 lakhs without collateral. The amount that a student can borrow varies, depending on the B-School and the cost of tuition for the program. In most cases, the student can borrow up to the full cost of tuition. However, this also varies, depending on the profile of the individual applicant. Though non-banking institutions such as Avanse, Prodigy Finance, Stilt & Credila provide higher value loans without collateral, they also charge a higher rate of interest when compared to banks. Here is the list of various Non Banking Institutes that offer Non-Collateral education Loans to Indian students.
AVANSE Avanse provides unsecured loans up to INR 50 lakhs. The rate of interest that Avanse typically charges for education loans is 12.75%; this rate might be higher in some scenarios. For more information, see http://www.avanse.com/start-smart The Paras Education Foundation
There is no limit on the amount that can be borrowed under the Paras Education Loan Scheme. You can avail of loans to meet the full amount covering your tuition fees and living expenses, after deducting any scholarships and financial aid. Paras Education Loans are available at an interest rate of 3.5% to 6.5%, linked to the Wall Street Journal Prime Lending Rate (PLR). Typically no collateral, physical mortgage, security, or margin money is required for the Paras Education Loan. A valid and credit-worthy co-signer may be required but the co-signer is not required to provide any collateral, physical mortgage, security, or margin money. For more information, see: https://www.isloan.org/
Prodigy Finance For MBA Students, Prodigy Finance provides up to 80% Cost of Attendance (as provided by the school) with a minimum loan size of Rs 15,000. The interest rate varies from 5.0% to 7.5% (fixed) over the three month GBP Libor or USD Libor Base Rate (variable). Rates are dependent on individual applicant profiles. For more information, see https://prodigyfinance.com/ MPower Financing Currently, the maximum an individual can borrow from MPOWER is $50,000. This is limited to $25,000 for each academic period. Their fixed interest rates are between 7.99% (8.85%APR) and 13.99% (14.87% APR). You can receive a 0.25% rate discount by repaying your loan through automatic withdrawal, and an additional 0.25% discount for making 24 consecutive on-time payments while repaying your loan through automatic withdrawal. Rates are dependent on individual applicant profiles. For more information, see https://www.mpowerfinancing.com/ Stilt Candidates can apply for a loan up to a sum of $25,000 from Stilt. Their interest rate varies from 10% to 15.99% For more information, see: https://www.stilt.co/ Credila Credila provides a maximum loan amount of INR 20 lakhs for higher education abroad and INR 10 lakhs for higher education in India. Their interest rates starts from 9.33%. For more information, see http://www.credila.com/abroad/partial-list-of-universitiesfunded.html GyanDhan GyanDhan provides loans up to INR 30 lakhs. For collateral loans, the interest rate starts from 9.1% while for non-collateral loans, the interest starts at 11.5%. For more information, see https://www.gyandhan.com/
4. Self-finance This is something that a lot of people ignore. But when you look at self finance, you’re going to look at every little thing. You don’t look at just the bank account but also look at mutual funds, provident funds, and maybe gratuity. You’re looking at all the money you have invested in other places, such as bonds or fixed deposits. If you have a bike or a car you can sell, you can get some money. If you are living in a rented house, you probably have a deposit; you can get the deposit back. Even something as simple as liquidating an asset on OLX could better your financial situation. It sounds stupid but people really sell electronic items they have, and may not use. You could possibly look at getting money that way.
5. Soft Loans Something that a lot of people do not consider. Typically, you get a soft loan from friends, family and what is known as “fools”. You want to get a loan from someone who can lend you about INR 5 to 10 lakhs for a couple of years, and you give your word of honour. It’s maybe an uncle in London who can give you INR 10 lakhs, and you can pay him after you start working.
6. Scholarships An MBA scholarship can ease your financial burden to a large extent but to get a good scholarship, you often need a very high GMAT score, and an excellent profile. Many top MBA colleges offer various scholarships, and there is a general perception that these scholarships are difficult to get considering the number of students applying for them. It might be difficult but surely not an impossible task. The scholarships are generally classified into merit-based and need-based. Need-based scholarships are given after considering your financial background, including various assets and liabilities, while the merit based scholarships are offered based on your GMAT score and profile. If you are looking at scholarship as an option, Here are the scholarship details of some top B-schools: Harvard Business School This school provides need-based fellowships to students with limited financial resources. The special interest fellowships are for those with various interests or backgrounds. 50% of HBS students are eligible for need-based Fellowships. These scholarships include The Robert S. Kaplan (MBA 1983) Life Sciences Fellowship (for students interested in a science-based career), Junior Achievement Fellowship( for students with Junior Achievement experience) and Horace W. Goldsmith Fellowship (non-profit). Click here for more info – http://www.hbs.edu/mba/financial-aid/internationalstudents/Pages/default.aspx
Stanford MBA scholarship All MBA students, regardless of citizenship, are eligible for financial aid. Due to the rigorous nature of our MBA curriculum, they don’t recommend that students rely on part-time work to cover the cost of the program. The Stanford GSB Financial Aid Office offers “need-based” fellowship and not meritbased fellowships
The Reliance Dhirubhai Fellowship Program provides future Indian leaders with the educational foundation for affecting positive change in India. Every year up to five students are selected for the program with a condition to return to India to lead organizations that are at the forefront of growth and development in the rapidly emerging Indian economy. Click here for more info – https://www.gsb.stanford.edu/programs/mba/financialaid/us-citizens-permanent-residents London Business School London Business School offers a wide range of scholarships. Most of the scholarships are available to successful applicants who apply in Stages 1, 2 and 3 of the MBA application process. You’ll find out more about scholarships, including how to apply, when you receive your offer. All these scholarships are subject to change without notice. Carnegie Mellon (Tepper) Scholarships and fellowships are awarded to full-time MBA candidates who exhibit a high degree of potential for success in the program and in their careers
National University of Singapore The National University of Singapore (NUS) offers a number of merit based scholarship schemes to better support and ease the financial burden of students.
INSEAD INSEAD Scholarships are the most sought-after source of financial assistance. The number of scholarships is limited, and there is significant competition for each award. These scholarships are granted under various criteria, and there are essentially two basic categories of scholarships: •Need-based: demonstrate financial need
•Non-need based: based on either merit, nationality, gender, professional background, leadership abilities, field of previous studies, etc. For all INSEAD scholarships, they require applicants to provide accurate details of their financial situation. Click here for more info – https://www.insead.edu/masterprogrammes/mba/financing HEC Paris Once admitted into the HEC Paris MBA Program, you will have the opportunity to apply for HEC MBA Scholarships. These scholarships are highly competitive. Once admitted, you will receive guidance from your Admissions Officer to apply for a scholarship. Wharton MBA scholarship Wharton provides a broad range of scholarship opportunities for exceptional students. Some of the fellowships offered include the emerging economy Fellowships (students from emerging economies), Joseph Wharton Fellowships (outstanding achievements), Howard E. Mitchell Fellowships (outstanding students from under-represented backgrounds) and Social Impact Fellowships (public or not-for-profit sector). Click here for more info – https://mba.wharton.upenn.edu/tuition-financial-aid/
Cornell (Johnson) In addition to the Park Fellowships, Johnson has over $1.5 million in merit-based scholarship funds to award each year to new students Chicago Booth scholarships All Chicago Booth scholarships and fellowships are awarded based on merit. The eligibility for many of the fellowship programs is decided by the criteria of individual alumni and foundation donors. There are several scholarship programs like India Trust Fellowship (for those living and working in India), The Wallman Fellowship (for women from underrepresented minority groups) and the Akhtarali H. Tobaccowala Fellowship (for students from India) Click Here for more info – https://www.chicagobooth.edu/programs/fulltime/admissions/tuition-financial-aid
Said Business School For over two-thirds of Oxford scholarships, nothing more than the standard course application is usually required. If you fulfill the eligibility criteria, your will automatically be considered. There are various fellowships available like the Forté Foundation Fellowships (Two scholarships of £15,000 for female candidates), Alumni Annual Fund Scholarships (academic excellence ) and Saïd Business School Foundation Scholarships (strong career progression and excellent career potential) Some scholarships you have an obligation to submit a scholarship essay. To find out more about the scholarships available at Oxford, and how to apply for scholarships which require applications, please use the Fees, funding and scholarship search.
Michigan (Ross) You are considered for scholarships when you apply to the Full-Time MBA Program, and you are notified of any award when you are admitted. This applies to U.S. citizens, permanent residents, and international students. No separate application is required. Awards are based on academic ability, professional and personal achievements, and potential to contribute to our community. Scholarships range from $5,000 to full tuition.
UCLA (Anderson) Many private organizations offer scholarships and fellowships to graduate students in all fields. The UCLA Graduate Division offers an excellent resource for finding these external awards
IMD IMD offers a variety of merit and need-based MBA scholarships. Applicants may apply to several simultaneously. However, only one scholarship is awarded per candidate. Scholarships granted are subject to nomination by the scholarship selection committee, acceptance into the program and confirmation of your intention to participate in the program by paying the advance deposit. The various scholarships include MBA Class Scholarship for Emerging Markets (good academic results (GMAT), strong reference letters & steady career progression), IMD MBA Future Leaders Scholarships (exceptional leadership understanding – essay based), & NestlÊ Scholarship for Women (women from developing countries) IMD reserves the right not to award a scholarship if the criteria are not met to the satisfaction of the jury/sponsors.
IE School of Business About 40% of the students receive every year some help between 15% and 45% of the cost of tuition. The scholarships program of the IE Foundation offers multiple targeting options for different profiles, giving different amounts and to a limited number of candidates depending on each year’s budget. Click here for more info – https://www.ie.edu/financial-aid/
SDA Bocconi
There are several scholarships and tuition waivers offered by the School, as well as by companies, consultancy firms, and other organizations. These are usually awarded before the Program begins. Admission to the Program is independent of the allocation of any scholarship or tuition waiver. Melbourne Business School Generous scholarships are available to students to support their full-time study for an MBA at Melbourne Business School (MBS). There are scholarship opportunities for candidates applying in any round who meet the specific criteria and some scholarships are connected to each Round. To be considered for their Scholarships you must first complete an online application and refer to the application deadlines for the specified round date. All full-time MBA students, who have been successful in obtaining a place in the program, are automatically considered for scholarship support. Therefore you do not need to submit a separate application for a scholarship. When you receive an offer of admission into the MBA program, you will be advised of any scholarship award and if additional documentation is required. Click here to know more – https://mbs.edu/above-search-links/currentstudents/scholarships
Yale School Of Management Yale School Of Management provides a small number of partial scholarships to exceptional candidates for the MBA for Executives program. Recipients of these highly selective awards will have to demonstrate a track record of outstanding leadership at the intersection of business and society. Scholarships will be awarded to individuals whom the selection committee members believe will enhance the program experience through their distinctive perspectives and experiences. In addition to merit, demonstrated financial need will play a major role in determining award recipients Click Here to know more – http://som.yale.edu/programs/mba/admissions/financing-your-mba
ESADE ESADE Business School offers and awards a considerable number of scholarships to outstanding Full-Time MBA candidates during their admissions process. Most of these Scholarships are possible by the allocation of the Business School funds, as well as the generosity of our donors and alumni contribution. The aim is to recognize and encourage talented candidates applying to ESADE Business School. There are two criteria in which the scholarship can be evaluated. The Talent criteria evaluate the academic excellence, personal achievements, proven professional acumen and a determination to influence the future of business. The Need based criteria, evaluates not only the merit profile but also the financial need of the candidate. Click Here to know more – http://www.esade.edu/ftmba/eng/fees-financing/mbascholarships
Imperial College London Imperial College Business School offers a significant scholarship funding to their most talented applicants. A range of scholarships are available and all self-funded candidates are automatically considered for all scholarship schemes for which they meet the eligibility criteria and application deadlines. St. Gallen The University of St.Gallen MBA is committed to help outstanding individuals from various regions around the world.
There are several scholarships offered like the Expert Scholarship (For candidates with academic background in sciences or engineering), Emerging Markets Scholarship (For candidates from emerging markets), Outstanding Candidates Scholarship, & MBA Event Scholarship (For candidates who meet one of their Recruitment Managers faceto-face at regional fairs or events) Warwick School of Business A number of scholarships are available to students admitted into the Warwick FullTime MBA. This is to promote gender, geographic and sector diversity, alongside recognition for academic and professional excellence. WBS scholarships are highly competitive and awarded on the basis of three broad criteria: Academic performance including GMAT score, strong career profile and the ability to fulfill future ambassadorial duties for the school. NYU (Stern) Up to 20% of admitted Full-time students are awarded a merit-based scholarship. Awards range from partial to full tuition and fees. All full-time applicants (both domestic and international) will be considered and reviewed for merit-based awards. Click here to know more – http://www.stern.nyu.edu/portal-partners/financialaid/loans/private-loans/international-students
Emory (Goizueta) There are a number of scholarships available through both Goizueta and partnerships with local and national organizations.
7. Collateral Loans in India If you look at collateral loans, you pretty much know the interest rates that typically work, and you get the loan against property that you mortgage. You can get up to 85% of the expense as a loan if you have sufficient assets to show. The upper limit however, could be very high, depending on what you have mortgaged.
8. Co-signer Loans in the US While applying for an education loan, international students have two options: the no co-signer option, and the co-signer option. We have already covered the no co-signer option at the beginning of this e-book. We will now talk about the second alternative, the co-signer loan option. Co-signing mainly involves getting someone who’s been in the U.S. for a while to sign the loan contract with you. Yes! You are still liable to pay the debt after you graduate but if you fail to pay off the debt after you graduate, your co-signer comes into the picture. With the co-signer option, the bank reduces their risk by having an opportunity to recover their money from the co-signer. Being a co-signer comes with some risk, and that’s the reason co-signers are often skeptical about it as their credit ranking and history would be in jeopardy. Some of the institutions that provide loans to international students with a US cosigner are Wells Fargo, Citizens Bank, Sallie Mae, Union Federal, and Discover.
In a nutshell, there are five important ways to fund your MBA at a top B-School. You could get a no co-signer loan from a bank that the college is tied up with. You could get an Indian loan against collateral, or no collateral. Third, look at self finance. Fourth, look at soft-loans from friends and family, and fifth, look at scholarships. If you found our article useful, do share it with your friends who are looking to pursue their MBA abroad, or at ISB, India. Thank you, and if you have any questions, feel free to comment; we’ll be glad to help you. Thank You!
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