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Non-banking financial companies have seen a 25-50% drop in applications for loans to study in the US.  (Bloomberg) Non-banking financial companies have seen a 25-50% drop in applications for loans to study in the US. (Bloomberg)

Summary

Since the start of Trump’s presidency, tensions between several US universities and the government have unnerved many parents in India. Delays in visa slots, demand for greater scrutiny of social media profiles of those aiming to study in the US have prompted students to consider other destinations.

Every August, the largest batch of Indian students heading abroad for higher studies typically goes to the US. It is called the fall season. But this year, the numbers tell a different story. Non-banking financial companies (NBFCs) have seen a 25-50% drop in applications for loans to study in the US, as have counsellors who help students navigate the study-abroad admissions process amid unavailability of visa slots.

However, the decline is expected to be temporary. While some students are eyeing universities in other countries or deferring their admissions by a year, the number heading to the US is likely to rise again by next fall.

“US student enrollment has significantly dropped over the past 5-6 months due to the unavailability of visa slots…Unavailability of visa slots has led to 25% students to drop out or wait for the next round of admission to consider other popular destinations for overseas education," said Piyush Kumar, regional director—South Asia, Canada and Latin America, IDP Education—a study-abroad counselling firm.

Since the beginning of Donald Trump’s presidency, tensions between several US universities and the government have unnerved many parents in India. Delays in visa slots, demand for greater scrutiny of social media profiles of those aiming to study in the US, among others, have prompted undergraduate and postgraduate students to consider destinations beyond the US.

According to the latest data shared by America's Student and Exchange Visitor Program (SEVP), students from India increased by 11.8% in 2024 compared to 2023. These are students who hold the F-1 and M-1 visas. The former is offered to students whose primary purpose is to complete an academic course of study while the latter is to pursue a vocational course. The SEVP is a web-based system that the Department of Homeland Securities uses “to maintain and manage information" on foreign students.

NBFCs, along with banks, that offer student loans have seen a decline in applications. “Initially, following Trump’s election, there was about a 20% decline in interest among students for US programs. After the visa pause was introduced, the impact deepened, with up to a 50% decline in applications, particularly from the southern region of India, which traditionally served as a strong hub for the US market," said Ankit Mehra, co-founder and chief executive officer of GyanDhan, an NBFC that focuses on loans for overseas education.

In May, the US government directed its embassies to stop scheduling new interviews for international student visas.

Prior to this, the US embassy in India had cautioned students that skipping classes or leaving the program without informing authorities would lead to visa revocation, as the Trump administration mounted scrutiny of overseas students to stop scheduling new interviews for international student visas.

For non-bank lenders, the average ticket size for a loan to study in the US is 40 lakh. Other popular geographies among Indian students include the UK, Canada and Australia. A four-year undergraduate degree from any of these countries could set one back by $55,000-$100,000 a year.

But, the decline in applications should stabilize and then increase over the next 12 months. “We expect recovery to start in Fall'26," Mehra said. Students head for higher studies in the fall season, which is typically August-September and a smaller batch heads for the February-March period.

Surprisingly, many students are willing to defer their courses or wait a year and then re-apply. “Students unable to secure admissions this year will re-apply, creating a rush and making scholarships harder to secure. Many of those taking a drop year are preparing by gaining work experience through internships, volunteering, or by acquiring new skills and certifications — both technical and non-technical — that bolster their CVs and benefit them in the long-term," said Nilanjan Chattoraj, head, credit and product, education loans, InCred Finance.

Counsellors like Namrata Pandey, founder of La Mentoraa, an organization that specializes in helping students gain admission into universities in India and overseas, are optimistic. “About 50 students are heading to the US this fall and there are a couple who did not get their visas. The only difference is this year, parents are considering options of studying in India as seriously as they would for a degree in US."

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  • #donald trump
  • #education

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