Neeraj Saxena – CEO – Avanse Financial Services Limited, Mumbai
Mr. Saxena tells us about the services of Avanse and how students can benefit from their services to fulfill their dream career.
Avanse Education Loans, a new age education finance company is an Associate Company of Dewan Housing Finance Corporation Limited (DHFL), one of India’s leading housing finance company in the private sector. Avanse is a Non-banking Finance Company (NBFC) and is regulated by the Reserve Bank of India. The Company was conceived with the aim to fulfil the gnawing need for education finance at reasonable terms, thus enabling every student to pursue their right to an education of their choice and achieve their career goals. Avanse was launched in 2013 with a vision to empower the Indian youth in their quest for a better future, by propelling their aspirations to a platform which provides the best access to quality education finance.
Neeraj Saxena – CEO – Avanse Financial Services Limited
Every parent wants their child to benefit from a good education, but sometimes money comes in the way of these hopes. Exhausting personal savings, borrowing from friends and relatives, selling property or jewellery is just not feasible for most people. That’s where Avanse come in, providing customized education loans to support one’s education and cost of living.
Applications received and Criterion for an education loan
Avanse receives over 200 applications annually. Under Graduate courses are the significant vertical of our product line and we see a growth of at least 10% in the coming year.
The criterion for assessing a loan is as follows:
· Nature of the course
· Institute standing/Country of Choice
· Fee Structure
· GRE/GMAT scores
· Co-borrower details
· Collateral Security Offered
· Student Academic Background
A student applying to an A grade university, definitely simplifies the process of an education loan for the student as most A-grade colleges provide campus placements for almost all of their students. USA continues one of the most preferred destinations for Under Graduate applicants followed by Canada, Australia, UK, Germany and New Zealand.
At the Bachelor’s level, we have seen a huge demand in courses like Engineering, Physics, Chemistry, and Computer Science. Medicine related courses such as MBBS have also gained popularity. Avanse is also noticing a shift towards B.Com, B.A., Fashion designing etc.
On the socio-economic front, Mr. Saxena tells us that a major chunk of the applications received by Avanse are from students in the middle class community. We are noticing a trend where we see a large section of Indian middle class families sending their children abroad for their Under Graduate or Post Graduate courses. He also informs us that 60% of loan applications received by Avanse are from middle class families while the other 40% are from affluent families.
When asked about the courses abroad, Mr. Saxena said that in the UK, a three year bachelor course will cost you anywhere between Rs 80-90 Lakhs. While a 4 year course in USA will cost you Rs 1 crore. If a student chooses to study in a cheaper institution, the cost would be about Rs 50-60 lakhs.
For PG courses, the amount goes up depending on the course. The difference in cost between UG and PG courses is only because of the duration.
Avanse does not have an upper limit for loans and provides 100% coverage. Avanse not only funds your course fee but also your living expenses, food, laptop, travel expenses, etc. Avanse ensures that the entire amount is funded with no burdens over the student during his course.
Mr. Saxena tells us that Avanse is open to offering education loans for any course or university provided they are recognized. The recognition of the course, reputation of the university, the employability of the student on competition of the course is all taken into account before the loan is sanctioned.
What does Avanse give importance to – Merit OR the ability to repay?
Mr. Saxena adds that merit does matter apart from the ability to repay the loan. The stronger the merit of the student the better is the chances of the student getting a better job and repaying us. We at Avanse prioritize the merit before sanctioning the loan.
The differences between Avanse and other traditional banks
· Avanse sanctions 100% of the loan amount while traditional banks restricts this amount to about 20-40 lakhs
· Avanse’s products are risk based, lower the risk, better the rate of interest, higher the amount of loan
· Avanse stresses on the merit of the student and course
· Avanse’s loan processing is faster
· Avanse offers a valuable time period to pay the principal amount post completion of the course
· Avanse educates the student on responsible borrowing
· Avanse safeguards students against inflation and or currency fluctuation
· Lastly, we provide the prerequisite of providing proof of funds while admission and support a student’s cost of living too
Apart from the above, Avanse is flexible that students can apply for an education loan from anywhere. Avanse Education Loans provides financial assistance through Avanse standalone offices in Mumbai, Delhi, Pune, Hyderabad, Bangalore, Chennai, Ahmadabad and Kolkata as well as through the DHFL network offices for consumer reach.
The procedure to get a loan from Avanse for an UG course is as given below:
· From students: Loan application form duly filled and signed by the student and the parents, KYC documents, Educational documents from students for 10th and 12th, Entrance test results, Resume and Extracurricular and leadership certificates.
· From Parents: Bank statement, IT returns, Pay Slips, Documents related to collateral (all photocopies)
· The loan is processed within 5-7 days and the student is informed if the loan is approved or not
Interaction with Students and Educational Institutions & Repayment
We do interact with schools and universities in India and abroad on a regular basis. When students present the admission letter, we contact the university to check the authenticity and validate the facts. We further sign MoUs and tie up with them to customize the financial assistance to students.
The repayment for UG and PG is different. Since the UG courses are longer in duration, the repayment starts immediately from the parent or guardian. While for a PG course, partial interest is collected on a monthly basis. The EMI starts 6 months after completing the course, enabling the student to find a job and settle down. Simple interest has to be paid monthly by parent or guardian. The tenure of the loans is about 10 – 12 years.
Avanse ensures the merit and strength of the student to land a promising job post the completion of his/her course.
Students can then repay the loan without having to depend on their parents. Substantial research is done on the course and the risk associated with it before disbursing the loan. Avanse has till date serviced over 4500 customers and has financed students in more than 36 countries. Avanse’s loan portfolio as on March 2016 is Rs 530 crores. Disbursements and Sanctions as on March 2016 were Rs 671 crores and Rs 1,633 crores respectively. The Average ticket size for Avanse as on March 2016 is Rs 12.91 lakhs.
Avanse keeps a close track on students once the loan is disbursed. The student also feels responsible as they feel that there is a constant check by the education loan provider thereby ensuring them to excel in the field. The research & development wing at Avanse does an extensive research on the educational pattern in countries. Our understanding of the education space and the complex admission process enables us to support the dreams of deserving students. Undertaking extensive research and utilizing our expertise, we focus on offering tailor-made financing solutions for every student.
Mr Neeraj Saxena concludes by saying, Avanse is creating an impact in the education loan sector in India with over 4000 students attending 1700 universities all over the world. We are becoming a popular education loan institution all over India because of our student-friendly nature and new age attitude. We at Avanse are dream enablers for every student who Aspire without any boundaries. We empower the Indian youth in their quest for a better future, by propelling their aspirations to a platform which provides the best access to quality education finance.
For more information please visit: http://www.avanse.com/
Corporate and Registered Office Address
Avanse Financial Services Ltd
Gr. Floor, Madhava Building,
Bandra Kurla Complex,
Near Family Court, Bandra – East,
Mumbai – 400 051