Prodigy Finance is a UK-based financial institution that has revolutionized the education loan process as they provide funding to students on the basis of their academic profile and don't require collateral or co-applicant.

Prodigy Finance education loan is provided by a circle of investors. Most of the participating institutes are located in the US, the UK, and Singapore. Students from 150 nationalities can apply for an education loan from Prodigy Finance. 

Overview of Prodigy Finance education loan

Features 

Details

Collateral

Not Required

Financial Co-applicant

Not Required

Loan amount

Need-based

Currency

USD or EUR

Interest rate

12-15% (converted from LIBOR to MCLR)

Processing fee

2.5% to 4% of the sanctioned loan amount

Prepayment Penalty

Nil

Repayment

Starts after 6 months of course completion

Repayment Tenure

Up to 20 years

Prodigy Finance education loan procedure

After getting your admission letter from the university, you can apply online. The committee will review your application and perform a cross-border credit analysis to make sure there is no history of credit default. They will reply to you within five working days. You will receive provisional approval if your loan is approved. You need to submit KYC documents, Anti Money Laundering (AML), and Politically Exposed Persons (PEP) criteria for a background check.

Prodigy Finance loan credit assessment includes elements such as pre-study salary, university acceptance, and future income for individual loan affordability.

For verification, you will need to upload your passport and admission letter. Prodigy Finance directly sends the funds to the university after you have uploaded the documents and have signed the agreement.

To understand in detail how international lenders like Prodigy finance works, go through the 10th and 11th episode of the web series called "Loanflix- Abroad education loan simplified". 

Prodigy Finance processing fee

Prodigy Finance charges a whooping processing fee of 2.5%-4% of the sanctioned loan amount. This is a very high figure when compared to government banks. 

For example, let's assume Alex is a student from India who got an admit into one of those top universities which Prodigy Finance supports. Now he requires INR 50 lakhs as an education loan. If Alex goes with Prodigy Finance, he has to pay a processing fee of 2.5%, which is INR 1.25 lakhs. At the same time, Alex might have to pay nothing or at max INR 10K if he would take the same education loan from a government/ public bank in India.

Prodigy Finance Education loan term, collateral, and repayment period

There are two loans available, one for 1-year study program and the other for a two-year study program. Loans lent by Prodigy Finance are in US Dollars. There are a few critical disadvantages of taking a USD loan like

  • Currency fluctuation with INR depreciation (Ex: 1$ was 64 in Jan 2018 and today 1$ is above 75) ultimately you repay way higher than what you borrow today
  • No income tax benefits under section 80E

It states an APR (Annual Percentage Rate) and it does not demand collateral or a co-signer. Moreover, you can repay after 6 months of your graduation. There is no penalty levied for early repayment. 

Prodigy Finance for MS, MBA, Policy and Law

Prodigy Finance for MS includes

Prodigy Finance for MBA, Law and Policy includes

For the entire list of universities and more details on applying for an education loan to Prodigy Finance India or International, visit Apply Now Page.

Benefits of Prodigy Finance

  • Loan Without Collateral or Co-applicant - The biggest benefit for students taking education loans from Prodigy Finance is that they are not required to pledge any collateral or bring in a co-applicant.
  • Completely Online Process - The entire Prodigy Finance education loan procedure is conducted online, so students do not need to visit the institution even once.
  • No Margin Money -Education loans from Prodigy Finance can cover up to 100% of costs. As a result, you will not be paying for any portion of the overall cost of your international education. Prodigy loans cover all expenditures, including tuition and living expenses, etc.

Demerits of Prodigy Finance

Whilst they don't require collateral or co-signer and everything seems too good, there are multiple demerits that put off many students from taking an education loan from Prodigy Finance. 

These demerits are not clearly seen from a top view on the first go. It requires one to understand a few International terminologies in Finance, and also market analysis of the past and the future. But, is very important for every student and parent to go through these, as taking an education loan is a long-term affair, and knowing it end-to-end is vital. To make it very simple and to the point, Rishika, a Ph.D. researcher from Stanford had done a deep analysis on this topic. You can read her critical insights here.