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Personal Loan

How a Personal Loan can help cover college fees in the new academic year

Key Takeaways

A personal loan can help pay tuition fees, hostel charges, books, laptops and other education-related expenses.
Personal loans are ideal for urgent college fee payments, with funds disbursed much faster than education loans.
Unlike education loans, personal loans offer flexibility in how the borrowed amount can be used.
Compare loan amount, repayment tenure and total borrowing cost before choosing between a personal loan and an education loan.

13 Aug 2026 by Team FinFIRST

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A personal loan works best for college fees when funds are needed faster than an education loan can be sanctioned, since it skips the co-applicant, income proof and paperwork requirement that an education loan involves. Plus, it comes without any restriction in terms of usage, unlike an education loan.

Once approved, the amount is sent directly to the borrower's account, ready to cover any expense including tuition, hostel or admission payments on the fee due date within minutes. This speed makes personal student loans a practical option when admission deadlines leave little time to arrange funds.

Personal Loan for School Fees in India: Quick Guide

FIRSTmoney On-Demand Loans for School Expenses

Can a personal loan be used for education?

Yes, a personal loan can be used for funding your education needs. Banks do not restrict how the disbursed amount from a personal loan is used covering broad categories such as travel, medical, wedding expenses, etc, and education sits within that list. This differs from an education loan, where disbursal usually goes to the institution or is limited to pre-determined expenses.

Can a personal loan be used for college fees?

Yes. A personal loan can be used to pay tuition fees, hostel charges, admission fees, books, laptops and other education-related expenses. Unlike an education loan, there are usually no restrictions on how the funds are used after disbursal.

Which educational expenses a personal loan can cover

Tuition fees: Semester or annual tuition payments due at the start of the academic year

Hostel costs: Hostel deposits, accommodation rent or mess charges

Books and material: Textbooks, stationery and other course material

Laptop purchase: A laptop or other equipment needed for the course

Certification courses: Short-term or online certification programs taken alongside a degree

Other admission costs: Application fees, entrance test fees or one-time admission charges

This flexibility is what makes personal student loans useful for splitting one loan amount across several of these heads, rather than following a fee-wise disbursal set by the lender.

Personal Loan vs Education Loan

Feature	Personal Loan	Education Loan
Processing time	Minutes	Several days
Co-applicant	No, however, other eligibility criteria apply	Usually required
Usage restriction	No	Yes
Tax benefit	No	Yes (eligible cases)
Course eligibility	Any	Approved courses
Best suited for	Urgent fee payments	Complete degree funding

When is a personal loan better than an education loan

Tight deadline: Families searching for loans for college students with a narrow admission window often prefer a personal loan for its quick disbursal

Smaller amount: For fees under a few lakh rupees, a personal loan skips paperwork tied to a co-applicant and moves faster than a full education loan process.

Course not listed: Vocational, short-term or unlisted courses outside a lender's approved course list for education loans remain eligible for a personal loan

Weak academic profile: Education loan approval weighs academic performance and institution ranking, while a personal loan is generally assessed on income and credit score

Which loan should you choose?

Here are a few common scenarios to help you decide whether a personal loan or an education loan is the better fit.

Scenario	Better Option
Admission fees deadline in 2 days	Personal loan
Fees for the entire engineering course	Education loan
Need ₹2 lakh for first semester fees	Personal loan
Need a high loan amount. E.g. ₹20 lakh for MBA	Education loan
Need laptop + pay hostel fees	Personal loan

Eligibility requirements

These are the eligibility requirements for IDFC FIRST Bank's FIRSTmoney personal loan.

Employment type: Applicants must be salaried or self-employed to qualify

Age bracket: Applicants should fall between 21 and 60 years of age

Credit score: A CIBIL score of 710 or above is required to apply

EMI calculations

The table below shows approximate monthly EMIs for different loan amounts at an interest rate starting from 9.99% p.a.

Loan Amount	Tenure	Approx. EMI*	Total Repayment
₹1,00,000	24 months	₹4,607	₹1,10,568
₹2,00,000	36 months	₹6,452	₹2,32,272
₹3,00,000	48 months	₹7,603	₹3,64,944
₹5,00,000	60 months	₹10,621	₹6,37,260

Your actual EMI depends on the approved interest rate, loan amount and repayment tenure. You can also use the IDFC FIRST Bank Personal Loan EMI Calculator to estimate your monthly repayments before applying.

Conclusion

If you need to pay college fees quickly and don't want to wait for the longer approval process of an education loan, a personal loan can provide fast access to funds for tuition, hostel, books and other education expenses. Compare the repayment cost, tenure and eligibility of both options before deciding which best fits your financial situation.

Frequently Asked Questions

Which is better, a personal loan or an education loan, for college fees?

An education loan usually works better for full-course funding due to its longer tenure and tax benefit, while a personal loan suits urgent or smaller fee payments.

What credit score is needed for a personal loan for college fees?

A credit score of 710 or above is needed for IDFC FIRST Bank's FIRSTmoney personal loan.

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.

The features, benefits and offers mentioned in the article are applicable as on the day of publication of this blog and is subject to change without notice. The contents herein are also subject to other product specific terms and conditions and any third party terms and conditions, as applicable. Please refer our website www.idfcfirst.bank.in for latest updates.