MPower Financing or Prodigy Finance: Which to choose for studying abroad?

MPower Financing

Ideated with an aim of removing the financial obstacles faced by students when pursuing international education, MPower Financing has helped thousands of students achieve their study abroad dreams. A major player in the international education loan sector, MPower is dedicated to making a positive impact in the world that goes beyond accomplishing our financial and strategic goals. With no requirements of a cosigner or collateral, they help support a student’s independence in the most easy and affordable way. When considering MPower vs Prodigy Finance, it’s clear that MPower Financing offers education loans at fixed and competitive interest rates that never increase, providing affordable funding. They also provide a complimentary visa support letter and visa prep course. With a smooth loan processing system, MPower Financing stands as a key payer preferred by most of the students aspiring to study abroad.

Prodigy Finance

With a philosophy that funding shouldn’t be a barrier to education, Prodigy Finance has helped over 40,000 students fund their higher education abroad. With a quick and easy loan application process, Prodigy Finance helps students travel across the world to get a top-tier master’s degree without the stress of a cosigner or collateral or any hidden costs. You can now secure a pre-approved student loan of up to $220,000* smoothly and affordably with Prodigy Finance’s smart and seamless financing.

Comparing International Education Loans by MPower Financing and Prodigy Finance

Being the top players in the industry, both, MPower and Prodigy, provide loans in foreign currency,
include zero exchange rate costs, don't require collateral or cosigners for securing a study abroad loan, but focus on the student’s future earning potential, with an option to directly disburse the loan amount to the university.

Both the lending institutions are similar in terms of the loan amounts offered and the origination fees charged, but let’s assess the differences in their interest rates, eligibility, and other factors to make the best choice.

Interest Rates on Study Abroad Loans by MPower Financing and Prodigy Finance

While both the lenders offer students support in terms of 100% of the cost of their education, MPower Financing’s lowest available interest rate is 12.99% (13.98% APR), and the average interest rate for loans is 14.99% (16.04% APR). The interest rate you qualify for will be a fixed rate and will not increase for the life of the loan. MPOWER charges an origination fee equal to 5% of the loan amount, which is automatically added to the borrowed amount, eliminating any hidden or out-of-pocket fees, and also offers borrowers a way to qualify for a discount; a 0.25% rate discount is possible by making your loan payments through automatic withdrawal from your bank account.

On the other hand, Prodigy Finance's interest rates are variable, and are made up of two components, a fixed margin and a variable benchmark rate. Students can secure their international education loans from Prodigy, starting from 5.25% fixed + 5.34%* variable interest rate. Prodigy Finance charges a processing fee of up to $100, payable when the funds are matched to the loan application to reserve your funds, and before your loan is finalised. They also charge an admin fee for each loan issued. The admin fee is up to 5% of the total loan amount. This fee is added to your loan amount when the loan is issued and spread across your monthly payments- you're never required to pay this fee upfront.

Countries Covered for Study Abroad Loans by MPower Financing and Prodigy Finance

While MPower Financing helps you secure student loans for your abroad education in the US or
Canada, Prodigy Finance supports students aspiring to attend 1733 schools, 483 universities in 19
countries, including Australia, the UK, Canada, the US, Germany, France, the UAE and many more.

Eligibility Criteria for Education Loans by MPower Financing and Prodigy Finance

An education loan from MPower Financing can be ensured, if you meet the following criteria:

For the United States:

You must be enrolled in a MPower eligible school.

• You must be enrolled in a MPower eligible program.
• You must graduate in the next 24 months.
• You must have applied for a valid study visa in the United States.
• You must have a GPA of at least 2.5 if you have completed at least one semester in your current program.

For Canada:

You must be enrolled in a MPower eligible school.

• You must be enrolled in a MPower eligible program.
• You must graduate in the next 24 months.
• You must have a credit history that can be reviewed as part of the process.
• You must have applied for a valid study visa in the Canada.
• You must have a GPA of at least 2.5 if you have completed at least one semester in your current program.

To determine if you're eligible for a study abroad loan, Prodigy Finance mandates three requirements (subject to affordability check):

• You must be admitted to a school and programme supported by Prodigy Finance.
• Prodigy Finance has an extensive list of schools that they support, easing your study abroad
  journey.
• You can smoothly get a quote on your abroad education loan from Prodigy Finance even
  before you have an acceptance letter. Prodigy Finance only asks for proof of admission when
  finalising your loan.
• You must be willing to study abroad.
• You must reside in one of the countries supported by Prodigy Finance.

If you meet these criteria, you will be able to complete a quick online application and get a quote from Prodigy Finance. In most cases, the quote is received immediately. It will include the amount you qualify for, the interest rate, loan term, and any fees that will apply.

Education Loan Application Procedure for MPower Financing and Prodigy Finance

MPower Financing’s straightforward loan application process focuses on verifying eligibility and
ensuring that you can finance your education effectively. Here’s a step-by-step guide to MPower’s

Application Process:

• Kickstarter your loan application by checking your eligibility on the MPower website and filling in your basic enrolment details.
• Provide essential information and documents such as proof of admission, identification, etc to
  complete MPower’s user-friendly application.
• The MPower team thoroughly reviews your application to check basic eligibility. If needed, you must upload any missing documents for the final offer from MPower.
• If approved, you’ll receive a loan offer from MPOWER detailing the loan amount, interest rate, and repayment terms.
• Once you accept the loan offer, MPower handles the rest, including school certification and fund disbursement.

Prodigy Finance’s smooth online loan application procedure seamlessly ensures a student’s study
abroad dream is realised. Here’s a step-by-step guide to Prodigy’s Application Process:

• The process starts with creating an online account on Prodigy’s website where their team assists you throughout.
• You’ll be required to input some details to receive a customised quote curated as per your needs from Prodigy Finance.
• To continue your application, accept the quote that’s most suitable for you and upload the required documents.
• After reviewing your documents, Prodigy Finance matches your application with their funds. Once your application is matched, you can confirm your loan and receive a loan sanction letter for your upcoming visa appointment and Prodigy can get your loan certified by your university.
• Once you land in your destination country and join your university, you need to digitally sign your loan agreement and wait for the funds to transfer to your university.
• The best part? You don’t need to pay anything until six months after your classes end, allowing you to focus on earning your degree and landing that dream job.

Documents Required for securing education loans by MPower Financing and Prodigy Finance

Just like their smooth application process, the list of documents required by both the lenders isn’t too long. The documents required include:

Drawbacks of securing an education loan from MPower Financing and Prodigy Finance

Let’s also consider the drawbacks involved with securing a loan from US lenders like MPower
Financing and Prodigy Finance. Some of them are:

• The processing fee charged by MPower Financing and Prodigy Finance is comparatively higher to some of the Indian lenders in the market. MPower charges an origination fee of 5% of your loan amount while Prodigy charges a processing fee of USD 100 along with an admin fee of 5% of your loan amount.
• When securing a loan from any of the Indian lenders, students are eligible to avail income tax
  exemption on the interest amount under section 80E of the Income Tax Act. US lenders do not have any such provision for cost savings.
• Both MPower and Prodigy offer loans in a foreign currency i.e. USD. This enhances the chances of increased repayment costs due to fluctuations in the exchange rate. Opting an lender offering education loans in INR can help you in long-term cost savings, regardless of where you choose to work in the future.

Which is better for you? MPower Financing or Prodigy Finance

Both lenders, MPower Financing and Prodigy Finance, rank as the top players in the international education loan sector without the requirements of a collateral or cosigner.

Let’s consider some important deciding factors that will help you choose the most suited lender for
your education loan to study abroad.

• MPower Financing offers education loans for students aspiring to study in the USA or Canada only, while Prodigy Finance provides education loans for students aspiring to study in various countries including the UK, Australia, Denmark, France, Germany, the USA, Canada, the UAE and many more.

• MPower Financing charges an origination fee of nearly 5% of your loan amount. This fee covers the costs of processing your application, checking your credit, and preparing everything for you. You won’t need to pay this amount upfront because the lender adds it to the borrowed amount. Prodigy Finance charges a $100 processing fee, which you must pay once they approve the loan. They issue the sanction letter only after you complete this fee payment. If you choose to withdraw your application and submit a new one (with a new university or course), you must pay this fee again, but you will receive a refund for the fee paid on the previous application. In addition to this processing fee, you also need to pay an admin fee of 5% of the loan amount.

• Assuming your preferred university is listed with both lenders, consider the following factors to choose which one to opt ? Let Lorien Finance guide you! If you are looking for an education loan with a fixed interest rate and a shorter repayment period without the hassle of paying any simple interest during your moratorium period, then you can choose MPOWER Financing. If you think an education loan with a floating interest rate is manageable and the repayment tenure should last upto 20 years with a completely free moratorium period, then Prodigy Finance is the best choice for you.

Choosing the right lender by evaluating them on the basis of several criteria isn’t a cakewalk. More
than difficult, the process is tedious and required utmost attention at the time you should be focussing on a lot more aspects related to studying abroad.

At Lorien Finance, we hold the expertise of assisting you with all your study abroad needs. Whether it's securing an education loan for your abroad education from MPower or Prodigy or any other lender, or helping you with FOREX services, finding a warm cosy place to stay in, and what not! We help you throughout your journey. Connect with us today for a seamless study abroad journey to your dream destination!

FAQs

Can I use my Prodigy Finance education loan for abroad studies to secure my student visa?

Once Prodigy Finance successfully matched your application to funding, they issue a letter confirming your loan. This letter can be provided at the time of your visa appointment to show the proof of funds. However, this loan confirmation letter by Prodigy Finance cannot predict if your visa would be accepted.

What do you mean by the certification of my loan by Prodigy Finance?

The United States mandates the certification process to protect borrowers. Before a lender can disburse funds to the school for the student, the school must complete the certification. On sending your loan for certification to the school, the school checks the loan amount to ensure it falls within its funding requirements, and your total financial profile to ensure that your loan combined with other funding sources will cover your tuition and living expenses. Once the school has certified your loan, Prodigy Finance updates your application accordingly. Certification can take anything from 3 weeks up to 3 months for the school to certify your loan.

How do I apply for second-year funding or a top-up loan with Prodigy?

If you wish to top-up your existing loan or are looking for funding your next academic period, you can simply sign in to your Prodigy student dashboard, choose the academic period you need funding for and fill out the application. Once Prodigy Finance matches your application with the necessary funding, they will finalize your loan.

How does Prodigy Finance match my application to funding?

The funds raised by Prodigy Finance come from various community investors and institutions. As per the conditions set by these investors, Prodigy matched applicants weekly who have completed the review process, and are in the matching stage.

What programs are eligible for an MPower education loan?

If you’re aspiring to pursue an on-campus bachelor’s or master’s or doctorate or professional degrees or an MBA, MPower has you covered.

Can I lower or negotiate my interest rate with MPower Financing?

MPOWER offers fixed-rate loans, which means you set your interest rate at the time of loan approval. While you cannot negotiate this rate, you can get a lower interest rate by 0.25% with their automatic payments option.