LeapFinance Education loan

Leap Finance offers education loans for students looking to study in the United States. Leap Finance India does not base loan approval on an applicant's current assets or their family's assets. Instead, the company focuses on investing in the potential of the student.

Given below is the information on the loan product offered by Leap Finance private limited for financing education in the USA. 

Leap Finance provides education loans to students wanting to pursue their post-graduation degree in the USA.  They provide unsecured education loans. i.e you don’t need any collateral to obtain an education loan. They finance your entire tuition fee or upto 100,000 USD at an interest rate starting from 8.5% depending on the student’s profile. They provide up to 10 years for loan repayment. 

Here we are gonna compare various parameters/ features offered by Leap Finance with the education loan products offered by Indian lenders in order to better understand the pros and cons offered by each.

*USD vs INR interest rate comparison is shared below in the article.

Processing Fee

Leap Finance charges a processing fee for their education loan services. The processing fee may vary depending on the loan amount and the specific terms of the loan. 

• The fee may be charged upfront, at the time of loan disbursal, or it may be included in the overall loan amount and repaid along with the loan principal and interest. 
• This fee is typically around 1.5 - 2% USD of the loan amount.

Interest Rate Parity

Leap Finance funds education loans with interest rates starting at 8.5%. While this rate may seem lower when compared to some unsecured education loan lenders in India, it can actually be more expensive when taking into account the interest rate parity and currency exchange rates because

• Interest rate parity is a method of comparing interest rates by taking into account the interest rate difference and current currency exchange rates. When the US dollar is strong and the Indian rupee is weak, the interest rate difference can be significant.
• When considering the current currency exchange rates, where the US dollar is reaching new highs, the interest paid on an education loan from Leap Finance may be much higher than what would be paid for an education loan from an Indian lender, even though the interest rate may be lower.

No Interest Subsidy Scheme Benefits

The government of India has implemented several interest subsidy programs for Indian students who are seeking education loans from Indian lenders to study in India or abroad. These programs include the 

• Central Sector Interest Subsidy Scheme
• The Padho Pardesh Interest Subsidy Scheme (which is currently suspended)
• The Dr. Ambedkar Central Sector Scheme. 

Under these schemes, eligible students can receive interest subsidies on education loans up to Rs 7.5 lacs. However, it is important to note that these interest subsidy schemes are only offered by the government of India and therefore, students who are planning to take a Leap Finance education loan will not be able to receive benefits from these programs.

Income Tax Exemptions

Indian students who take out education loans from Indian lenders may be eligible to claim income tax benefits under sections 80E and 80C of the Income Tax Act 1961. These benefits are not available to students who take out education loans from foreign lenders, such as Leap Finance Finance. Moreover

• According to section 80E, students can claim a tax benefit of up to Rs 40,000 on the interest paid toward their education loan. In addition, they may also be able to claim additional tax benefits under section 80C, even if they have already claimed benefits under section 80E.

This is a valuable opportunity for Indian students and their parents to save money on their education loans. However, it is important to note that students who take out education loans from foreign lenders, like Leap Finance Finance, are not eligible for these tax benefits. This is one of the major drawbacks of Leap Finance Finance education loans.

WeMakeScholars offers its services to students seeking education loans at no cost to them. This is because the organization receives funding and support from the IT Ministry, Government of India as part of the Digital India Campaign, which allows us to provide their services free of charge to students.

• Direct engagement with lenders - One of the advantages of using WeMakeScholars is the ability to directly engage with lenders. You can obtain the contact number of the executive handling your case from the lender's team and reach out to them directly.
• Technologically advanced - Additionally, WeMakeScholars is technologically advanced, which allows you to easily apply for, track, and manage your education loan from the convenience of your own home throughout the entire process. 
• The cashback offered -  Another benefit of using WeMakeScholars is the cashback that is offered. When you apply for your study abroad education loan through WeMakeScholars, you will receive a cashback of up to INR 3000 for multiple disbursements.
• Negotiation - Furthermore, the WMS team will strive to secure the best rate of Interest for you by negotiating with lenders on your behalf, while also ensuring that you are charged a fair price for the entire process, including legal fees and other expenses.

Below mentioned is the process that you go through when you process your loan with WeMakeScholars 

Step 1: The first step is to complete the Common Application form for Student Loans which you can find on our website. .

Step 2: After the form is submitted, a financial officer will contact you to verify your eligibility and request any additional information that is needed.

Step 3: After the eligibility is verified, you will be provided with a comparison of all the lending banks that you qualify for a loan. You can then choose a lender based on your eligibility and the lending policies of the bank.

Step 4: Once you have chosen a lender, you will need to submit your papers to the bank or upload them to WeMakeScholars' secure link-uploading portal, according to the document checklist provided by your financial officer.

Step 5: After the documents are submitted, they will be logged in and you will be informed of the outcome of your loan application within 2–6 days for private banks and within 15–20 days for government banks.

Step 6: Once the loan is approved, you will receive a letter of sanction and will need to sign the loan agreement.