When students plan to study abroad, choosing the right education loan becomes one of the most important decisions. Two very popular lenders are Avanse Financial Services and MPOWER Financing. Both provide study-abroad loans without too much paperwork, but their features, eligibility, and total cost are very different.
This blog explains Avanse vs MPOWER Education Loan in very simple language. We will compare:
- Interest rates
- Eligibility
- Required documents
- Moratorium period
- Loan cost
- Who should choose which lender
- Practical examples and calculations
By the end of the blog, you will understand exactly which lender is better for your situation.
⭐ Overview of Avanse & MPOWER Financing
What is Avanse?
Avanse Financial Services is an Indian NBFC that provides loans for:
- Study in India
- Study abroad
- Test prep and living expenses
They offer secured (with collateral) and unsecured (without collateral) loans.
What is MPOWER Financing?
MPOWER Financing is a US-based lender that focuses only on international students studying in the USA or Canada.
MPOWER gives completely collateral-free loans with:
- No co-signer
- No collateral
- No Indian credit history
This makes it very popular among students who do not have property for collateral.
⭐Avanse vs MPOWER Education Loan: Key Differences at a Glance
| Feature | Avanse | MPOWER Financing |
| Loan Type | Secured & Unsecured | Only Unsecured |
| Collateral Required | Optional | Not required |
| Co-applicant | Mandatory for unsecured | Not required |
| Interest Rate | 10.5% – 16% | 12.99% (fixed) + 5% origination fee |
| Coverage | India & Abroad | Only USA & Canada |
| Max Loan Amount | Up to 75 Lakhs+ | Up to USD 100,000 |
| Processing Time | 4 – 7 days | 7 – 10 days |
| Moratorium | Course + 6 months | Course + 6 months |
| Currency | INR | USD |
⭐ Interest Rates: Avanse vs MPOWER
Avanse Interest Rate
Avanse offers floating interest rates based on:
- CIBIL score
- Course
- Co-applicant’s income
- Collateral availability
Average rate: 10.5% – 16% per annum.
MPOWER Interest Rate
MPOWER offers a fixed interest rate:
- 12.99% fixed
- 5% origination fee (one-time)
Because the rate is fixed, it does not change during the loan period.
⭐ Eligibility Criteria
Avanse Eligibility
You can apply if:
- You are an Indian student
- You have an offer letter from a recognized university
- A co-applicant with stable income is required for unsecured loan
- For secured loans, you need collateral like property
MPOWER Eligibility
Very simple:
- You must be an international student
- You must study in US or Canada
- You must be in the final 2 years of your degree OR
- You must have a full admission letter
No co-signer and no collateral required.
⭐ Documents Required
Avanse Documents
- KYC of student and co-applicant
- Income proof of co-applicant
- Property documents (if secured loan)
- Admission letter
- Academic records
MPOWER Documents
- Passport
- University admission letter
- Study permit / I-20
- Address proof
- Some financial statements
Very minimal documents compared to Indian NBFCs.
⭐ Loan Amount & Coverage
Avanse Loan Amount
- Unsecured loan: Up to ₹40–50 lakhs
- Secured loan: ₹75 lakhs or more
Covers:
- Tuition fees
- Living expenses
- Travel
- Laptop
- Books
- Health insurance
MPOWER Loan Amount
- Maximum: USD 100,000
(~ ₹83 lakhs approx in 2025)
Covers:
- Tuition
- Living expenses
- Food
- Insurance
- Miscellaneous expense
⭐ Repayment Terms (Very Important)
Avanse Repayment
Repayment starts after:
- Course duration + 6 months
During the course, you may need to pay:
- Simple interest OR
- Partial interest OR
- EMI (if you choose)
Flexible options.
MPOWER Repayment
MPOWER requires:
- Interest-only payment during the course (small amount)
- Full EMI after moratorium (course + 6 months)
Fixed EMI because the interest rate never changes.
⭐ Processing Time
- Avanse: 4–7 working days
- MPOWER: 7–10 working days
⭐ Important Charges
Avanse Charges
- Processing fee: 1% – 2%
- Legal & valuation fees (for secured loan)
- GST on charges
MPOWER Charges
- 5% origination fee
Example:
If your MPOWER loan is $50,000, origination fee = 5%
→ 0.05 × 50,000 = $2,500
This gets added to your loan amount.
⭐ Cost Comparison with Calculations
To understand which loan is cheaper, let’s compare using an example.
Example Calculation
Example Case
Loan amount = ₹30 lakhs (or $36,000 approx)
Loan tenure = 10 years
Moratorium = 2 years course + 6 months
Avanse Loan Cost Calculation
Interest rate assumed = 12% per annum.
During moratorium, simple interest is charged.
Simple Interest for 2.5 years
Formula:
SI = (Principal × Rate × Time) / 100
SI = (30,00,000 × 12 × 2.5) / 100
SI = (30,00,000 × 30) / 100
SI = ₹9,00,000
This becomes part of the loan.
Total loan after moratorium
30,00,000 + 9,00,000 = ₹39,00,000
Approx EMI for 7.5 years:
≈ ₹65,000 per month
Total repayment ~ ₹58 lakhs
MPOWER Loan Cost Calculation
Interest rate = 12.99% fixed
Origination fee = 5%
Step 1: Add origination fee
Loan amount = $36,000
Origination fee = 5% → $1,800
Total loan = $37,800 (≈ ₹31.5 lakhs)
Step 2: Interest-only payments during studies
Assume monthly interest:
= (12.99% of 37,800) / 12
= ($4,907 / 12)
= ~$408/month
≈ ₹34,000/month
Paid for 2.5 years = 30 months
= 408 × 30 = $12,240
Step 3: EMI after moratorium
EMI for remaining 10-year tenure:
≈ $445 per month
(₹37,000 per month approx)
10-year total repayment ≈ $53,400
Total repayment for MPOWER
Interest-only payments: $12,240
- EMI total: $53,400
- Origination fee: $1,800
= $67,440
Converted to INR ≈ ₹56 lakhs
Final Cost Comparison
| Lender | Total Loan Cost |
| Avanse | ~ ₹58 lakhs |
| MPOWER | ~ ₹56 lakhs |
👉 MPOWER is slightly cheaper, but it depends on student profile and real interest rate.
⭐ Advantages & Disadvantages
Avanse Advantages
- Lower interest rate (for strong profiles)
- Higher loan amount
- Faster processing
- Available for many countries
Avanse Disadvantages
- Collateral or strong co-applicant needed
- More paperwork
- Floating interest rate
MPOWER Advantages
- No collateral
- No co-signer
- Simple documentation
- Fixed interest rate
- Helps build US credit score
MPOWER Disadvantages
- Only for USA & Canada
- High origination fee
- Higher monthly interest during studies
⭐ Which One Should You Choose?
Choose Avanse if
- You have a strong co-applicant
- You want lower interest rate
- You want to study in UK, Europe, Australia, etc.
- You want higher loan amounts (50–75 lakhs)
Choose MPOWER if
- You do not have collateral
- You don’t have a co-signer
- You are studying in USA or Canada
- Your family income is low or unstable
For many students who have no collateral, MPOWER becomes the best option.
⭐ Final Comparison Table (Quick Verdict)
| Category | Winner |
| Lower interest rate | Avanse |
| No collateral | MPOWER |
| No co-applicant | MPOWER |
| Higher loan amount | Avanse |
| Simpler process | MPOWER |
| Lower total cost | Slightly MPOWER |
| More country options | Avanse |
⭐ Conclusion
Choosing between Avanse vs MPOWER Education Loan depends completely on your profile and university.
- If you have a co-applicant with good income or collateral, Avanse is cheaper and provides flexible options.
- If you have no co-signer and no collateral, and you are going to the USA or Canada, MPOWER is the best choice because of its fixed interest rate and simple process.
Both lenders are trustworthy. Just calculate the total cost before taking the final decision.