As students looking for their financial partner for their higher education,they are stuck in between personal loan and study loan. Each funding comes up with different repayment rules, tax benefits and flexibility. A comparison has shed light on the key difference between these two key revenues, helping borrowers understand.
In May 2025, amid rising education costs and interest rates, students in India are increasingly evaluating whether to fund their academic journey with a personal loan or an education loan. As light sheds, their debate has been ongoing for so long. The difference between the two credit avenues helps borrowers understand how each option aligns with their financial and academic goals.
Education loans
Designed specially for education purposes offers loans on less interest and payment tenure is longer (up to 15 years), and a moratorium period – the grace window that provides students to pay loan after completing their study and gain employment. These loans need comprehensive information such as fee details, admission letter and identity documents. Often, a co-applicant (usually a parent or guardian) and collateral may be necessary for higher loan amounts.
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Personal loans
On the other hand, offer greater flexibility and faster processing but come at the cost of higher interest rates and shorter repayment windows. They are unsecured, rarely require collateral, and are usually sanctioned based on income and credit score — making them suitable for urgent or smaller educational needs.
