Canada is one of the most popular destinations for higher education, attracting students from India, China, Africa, and beyond. But the cost of studying here can be overwhelming — tuition fees range between CAD 20,000 – 45,000 annually, and living expenses can add another CAD 15,000 – 20,000 per year. That’s why finding low-cost student loan options is so important in 2025.
This guide highlights affordable lenders, both in Canada and abroad, that help students finance their education with competitive rates and minimal stress.
Why Students Look for Low-Cost Loans in Canada
- Visa requirement – Proof of funds is mandatory for student visas.
- Upfront GIC deposits – Most students under SDS (Student Direct Stream) must deposit CAD 20,000 in a Guaranteed Investment Certificate.
- Tuition pre-payment – Universities often require fees in advance.
- Post-study repayment – Affordable loans reduce financial burden after graduation.
Low-Cost Student Loan Providers in Canada (2025)
1. RBC Royal Bank (Student Line of Credit)
- Why it’s affordable: Competitive interest tied to prime rates.
- Highlights:
- Loan up to CAD 80,000+.
- Interest-only payments during studies.
- Early repayment allowed without penalties.
- Best for: Students with Canadian co-signers.
2. Scotiabank (Student Line of Credit + GIC)
- Why it’s budget-friendly: Combines loan + visa support.
- Highlights:
- Lower interest rates for strong applicants.
- Multi-year approval reduces paperwork.
- Ties directly into the Student GIC Program.
- Best for: International students under the SDS pathway.
3. CIBC Student Loans
- Why people choose it: Designed for international students.
- Highlights:
- Bundles loans with GIC programs.
- Competitive rates with flexible repayment.
- Grace period before repayment starts.
- Best for: Students wanting one-stop banking + loan services.
4. State Bank of India (SBI) – Global Ed-Vantage Loan
- Why it’s affordable for Indians: Lower interest compared to private lenders.
- Highlights:
- Loan up to INR 1.5 crore.
- Moratorium period until after graduation.
- Covers tuition, housing, and travel.
- Best for: Indian students studying in Canada.
5. HDFC Credila (India)
- Why it’s strong: Focuses only on education loans.
- Highlights:
- EMIs up to 15 years.
- Competitive rates compared to private banks.
- Covers tuition, living, books, and insurance.
- Best for: Indian students needing long repayment terms.
6. Prodigy Finance (Global Lender)
- Why it’s affordable: No collateral or guarantor required.
- Highlights:
- Approval based on future income potential.
- Loans for graduate programs.
- Covers tuition + partial living costs.
- Best for: International graduate students without guarantors.
7. MPOWER Financing
- Why it’s popular: Caters to international students without co-signers.
- Highlights:
- Fixed interest rates.
- Loans up to $100,000.
- Additional career and visa support.
- Best for: Undergraduate and postgraduate students without guarantors.
Average Loan Costs in Canada (2025)
- Canadian bank loans: 6% – 9% annually.
- Indian bank loans: 9% – 13%.
- International lenders (MPOWER, Prodigy): 8% – 15%.
- Repayment terms: 7 – 15 years.
💡 Example: A CAD 40,000 loan at 8% over 10 years = CAD ~485/month.
Tips for Finding Low-Cost Student Loans
- Compare lenders – Don’t settle for the first offer.
- Look for grace periods – Repayment after graduation is easier.
- Use co-signers if possible – Canadian guarantors lower rates.
- Check GIC tie-ins – Saves time and helps with visa approvals.
- Borrow only what you need – Smaller loans mean lower debt later.
Final Thoughts
Studying in Canada is expensive, but low-cost student loan options make it possible.
- RBC, Scotiabank, and CIBC are strong for students with Canadian co-signers.
- SBI and HDFC Credila offer affordable loans for Indian students.
- Prodigy Finance and MPOWER help international students without guarantors.
With the right financing, students can focus on education instead of worrying about crushing debt.