It’s no secret that tens of millions of Indians are burdened with student loan debt — and will be for years to come. But what’s not talked about as much is the emotional weight these graduates also carry.
According to a study published on August 4, 2023 in the American Journal of Preventive Medicine, students who took loans to pay for college rated their overall health and mental health as being worse than those who didn't take student loans.
The study examined data collected from surveys in 2017 of 3,200 local and international undergraduates at two public U.S. universities, looking to see whether there was a relationship between student loan presence and the health of students.
Three key findings from this study stand out:
53% of high-debt student loan borrowers have gone through depression as a result of their debt
Nine out of 10 borrowers reported significant anxiety related to their debt load.
One in fifteen borrowers of student loans had thought of committing suicide because of their debt.
Getting through higher education overseas without availing of a loan has become near impossible, say Indian students. With a sharp rise in tuition fees across popular study abroad destinations, along with other services such as boarding, food, project costs, etc., students claim that their education has become more of an obligation than a right, as it was in the case of getting scholarships.
Education loans worth over ₹7 cr disbursed in FY22
According to the numbers shared by the Ministry of External Affairs in Rajya Sabha on February 9, 2023, a whopping 7.5 lakh Indians - an all-time high - went abroad to study last year. This trend also meant an increase in the number of education loans disbursed to Indian students studying abroad.
According to data shared by the Ministry of Finance in Lok Sabha on February 13 in FY22 alone, Public Sector Banks in the country disbursed education loans for studying abroad worth ₹7,576.02 crore - a 68 per cent increase compared to FY21.
According to RBI data, in FY22, PSBs disbursed close to 90 per cent of the total education loans in the country.
Indian students bear the brunt of education loans
Puneet Singh, currently pursuing MBA from London, is already staring at a debt burden of ₹70 lakh. “My parents took an initial loan of ₹15 lakh to fund my Bachelors from a college in India and for my MBA, we took another loan. Collectively, it will be a huge sum to repay,” he said.
"I am pursuing my degree, working two jobs and doing a lot of side hustles to pay the bills," Puneet explains. "I still get anxious thinking about how I'm going to pay off such a huge debt because I do not intend to ask my parents for help," he continues, admitting that the journey is affecting his mental health.
Rajdeep Chaterjee, a student pursuing his Masters from the US shared a similar predicament. The 27 year old traveled to Berkeley Haas School of Business last year, and his total cost of course is estimated to be around $96,643 (roughly ₹80 lakh). He opted for a loan from a bank in the US itself to fund his higher education and shield himself from the impact of the dollar-rupee rate fluctuation, which made the process much easier.
Too much investment, too less returns
However, rising inflation has made Indian students concerned about their future. "Despite receiving a scholarship, I took a loan for college. I believe education has become a money-making enterprise since the amount of money we spend on education hardly results in a well-paying job. Why, so many of my MBA graduate friends have landed jobs with a starting salary of ₹50,000 to ₹60,000 in government and private companies, when they have spent tens of lakhs of rupees on colleges availing student loans," asks Kanishk Gupta, a student pursuing Master’s in Business Administration in Australia.
Though Kanishk is working and side hustling almost seven days a week just to get by and pay off his loans, he advises others that getting out of debt is not worth burning yourself out over. “For a lot of things in life, we have to try to enjoy the journey,” he says. “Take care of your mental health because nothing else in your life will work if it’s not intact.”
Could have negative impact mental health
Students in India will have to fit student loan payments into personal budgets that are already being strained by consistently high inflation. Experts expect that the increased financial stress would have a negative impact on students and their families mental health. “A lot of parents are keen on making sure their children get education from reputed schools and colleges, especially from international universities despite ill affordability. Some sell-off their properties, valuables or take hefty amounts of loans with high interest rates to just fulfill their dream of their child studying abroad.
"In a competitive world, students with no generational wealth are more likely to borrow. They are also more likely to attend for-profit colleges and to earn less money after graduation,” says Harish Chaturvedi, a Mumbai-based Education Loan Specialist.
“If you are struggling to pay off your student loans and feel the emotional burden of it all, know that it is manageable and there are people who can help you. Even Indian banks have their doors open for credit counseling. You can see the list on the Banking Codes and Standards Board of India website that offers a portal for people to call and receive free credit and student loan guidance too,” adds Harish.
Self-isolation due to shame of being debt-ridden
Imran Noorani an Education Counselor at GradGlobal Education speaks from personal experience about students' reaction to their debt. "While debt is becoming more common, many graduate students feel isolated by the shame of being in debt, which prevents them from having open conversations about it. It is understandable that many students would rather 'just not think about it' since adding financial stress to academic stress is burdensome."
Imran advises students to remind themselves of “what makes them happy". He shares what he calls a “great grounding mantra” for anyone in debt who feels unsafe: “Say, ‘I’m healthy, I’m safe, I have a roof over my head; in today’s world, that’s rich.”
"Students should be realistic about the fact that student loan debt will most likely follow them for the rest of their lives; it does not simply disappear. You're going to graduate, earn your degree, and then fall right into a cycle of student loan debt. It is critical to plan ahead and begin paying instalments as soon as possible,” Imran suggests.
