International Student Loans for Canada 2026: Lender Guide

What are the 3 main sources of international student funding in Canada?

Short answer: Three private funding sources cover most students, since government loans are closed to them. First, a Canadian-bank GIC of $20,635 CAD that covers first-year living expenses (Scotiabank StartRight, CIBC, RBC, ICICI Bank Canada). Second, home-country education loans (HDFC Credila and Avanse in India at 9.5 to 12.5%, HBL, UBL, and Bank Alfalah in Pakistan at 14 to 18%). Third, international private lenders that need no Canadian co-signer (MPOWER at 13 to 15% APR fixed, Prodigy at 10 to 13% for graduate school). Most students combine all three with family funds and any scholarships they win.

1. Canadian-bank GIC plus international student banking program

The most common path. A Canadian bank holds a $20,635 CAD Guaranteed Investment Certificate that covers your first-year living expenses. The bank releases the funds to you in monthly installments after you arrive in Canada. The GIC is your own deposited money, not a loan, and it now forms part of the standard study-permit proof-of-funds for applicants who choose this route.

Major Canadian banks offering international student GICs in 2026:

The GIC does not cover tuition. Tuition has to be paid separately, either from family funds, a home-country loan, or a private lender. Some Canadian banks will extend a tuition line of credit only after you have been in Canada for 6 to 12 months and built a credit file.

2. Home-country lenders

Home-country banks lend in local currency but typically require a co-signer with strong local credit. Common 2026 international student loan programs by country:

India: HDFC Credila, Avanse, ICICI Bank, Axis Bank, and SBI all offer education loans for Canadian study, with rates of 9.5 to 12.5% per year for collateral-free loans up to ₹40 lakh ($65,000 CAD). Larger amounts require collateral.

Pakistan: HBL, UBL, and Bank Alfalah offer education loans for overseas studies, but rates run 14 to 18% per year and amounts are limited.

Brazil: Santander, Itaú, and Bradesco offer Canada-bound education loans, though approval rates have tightened since 2023.

Vietnam, Philippines, Bangladesh: Limited bank lending for overseas studies. Most students rely on family funds plus private lenders.

China, UAE, South Korea: Education loans are available, but most families fund education from savings rather than borrowing.

The home-country loan is denominated in local currency, so currency depreciation against CAD increases your total cost over the life of the loan. A 10% depreciation over 4 years (typical) adds roughly 10% to your effective cost.

3. International private lenders (no Canadian co-signer)

A small set of US-based and global lenders offer loans to international students attending Canadian schools, with no co-signer required. The trade-off: higher interest rates and stricter program eligibility. The two best known for Canadian schools are MPOWER Financing and Prodigy Finance.

MPOWER is the most accessible for a typical international undergraduate at a Canadian university. Prodigy Finance is better for graduate students at top schools. Both disburse directly to the school, which means the funds count toward your tuition payment when you assemble your study-permit financial documents.

How does the GIC proof-of-funds requirement work in 2026?

Short answer: The Student Direct Stream (SDS) no longer exists. IRCC permanently ended SDS on November 8, 2024, so there is no separate fast-track stream and no SDS-specific GIC rule. Every study-permit application now goes through the same standard processing, and you must show proof of funds for tuition plus living costs. For 2026 the living-cost benchmark is about $20,635 CAD for a single applicant, and buying a GIC of that amount at a participating Canadian bank is a common, accepted way to prove it. The GIC is your own money held in trust and released to you after you arrive, not a loan.

For years, students from a list of countries used the Student Direct Stream for faster processing if they bought a GIC and prepaid tuition. That stream is gone. IRCC ended SDS, and its French-language equivalent the Nigeria Student Express, on November 8, 2024. If you read older guides that tell you to "apply through SDS" or describe an "SDS-only GIC requirement," that advice is out of date.

Here is how proof of funds works now under standard study-permit processing:

• There is one stream. All study-permit applications are assessed under the same standard rules, no matter which country you apply from.
• You must prove tuition plus living costs. You show enough money to pay first-year tuition and to support yourself (and any family members coming with you) for one year.
• The 2026 living-cost figure is about $20,635 CAD for a single applicant, with higher amounts for accompanying family members. IRCC adjusts this benchmark over time, so confirm the current number on the IRCC proof of financial support page before you apply.
• A GIC is one accepted form of proof, not a mandatory one. Buying a $20,635 CAD GIC from a participating Canadian bank is a clean, well-recognized way to show living-cost funds, but you can also use bank statements, an education loan, or other documented funds.

From a financial perspective, the GIC is simply your first-year living expenses pre-deposited in a Canadian account, then paid back to you in monthly installments once you land. It earns a little interest and gives a visa officer a clear, verifiable proof of funds. That is why so many students still use one even though SDS is gone.

Which tuition funding strategy works best for your country tier?

Short answer: Tier A high-income markets (UAE, Singapore, Hong Kong, Western Europe) typically pay cash plus a GIC. Tier B (India, Brazil, Mexico, Vietnam, Philippines) combines home-country loans covering 50 to 70% of tuition with family funds and a GIC. Tier C (Bangladesh, Pakistan, Nigeria) needs family pooling plus a private lender such as MPOWER or Prodigy, pushing total borrowing cost to 15 to 20% per year. Tier D (Iran, Syria, Russia) faces sanctions complications that route most funding through family in third countries.

Tier A (high-income source markets: UAE, Singapore, Hong Kong, Western Europe): Most families pay tuition in cash. The GIC is the only formal financial product needed. International student loans are not typically used.

Tier B (mixed-income markets: India, Brazil, Mexico, Vietnam, Philippines): Common approach is a home-country bank education loan covering 50 to 70% of tuition (HDFC Credila, Itaú, and similar), family funds covering the remainder, plus the Canadian GIC for living expenses. Some students supplement with a private lender for the gap.

Tier C (high-need markets: Bangladesh, Pakistan, Nigeria, parts of Africa): Often a combination of family pooling, a home-country loan with collateral, a private lender such as MPOWER or Prodigy Finance for the funding gap, plus the GIC. Total interest cost can reach 15 to 20% per year on the borrowed portion.

Tier D (sanctions-affected markets: Iran, Syria, Russia): Major banking complications. Most funding flows through family members in third countries. Cross-border lenders typically do not lend to applicants from sanctioned countries. Special documentation is needed for any cross-border transfer to Canada.

What are the repayment terms on international student loans in Canada?

Short answer: Most private and home-country loans require monthly repayment to begin within about 6 months of graduation, regardless of whether you have found Canadian work, with terms running 5 to 15 years. A $50,000 CAD MPOWER loan at 14% APR over 10 years works out to roughly $776 per month and about $93,170 in total, nearly double the principal. The practical playbook: borrow only what you need, pay interest during studies if you can, and refinance after 1 to 2 years of Canadian employment when local banks offer 6 to 9% rates.

Most international student loans require monthly repayment to begin within 6 months of graduation, regardless of whether you have found Canadian employment. Repayment terms typically run 5 to 15 years.

A typical $50,000 CAD MPOWER loan at 14% APR over 10 years works out to approximately $776 CAD per month. Over the full 10 years, you pay back $93,170 CAD. Almost double the principal.

Strategy implications:

• Borrow only what you need, not the maximum approved
• Pay interest during studies if you can. Most lenders allow it, and it dramatically reduces total cost
• Refinance after 1 to 2 years of Canadian employment when you have local credit history. Canadian banks typically offer 6 to 9% personal loans to permanent residents, far cheaper than a private lender's 14%
• Apply for Permanent Residence through Express Entry or a Provincial Nominee Program (PNP) as soon as eligible. Becoming a permanent resident also opens access to Canadian government student aid for any future studies

What is the costliest mistake international students make with loans?

Short answer: The single most expensive mistake is over-borrowing from a high-rate private lender "to be safe." Borrowing $20,000 more than you need at 14% APR adds about $17,000 in interest over 10 years. Instead, keep family funds liquid, borrow only the tuition gap, and cover living costs with the GIC plus part-time work. Study permits allow up to 24 hours per week of off-campus work during academic terms.

The single most expensive funding mistake international students make is borrowing more than they need from a high-rate private lender to "be safe" on living expenses, then carrying that debt at 14% APR for 10 years.

A $20,000 CAD over-borrow at 14% APR for 10 years costs an extra $17,000 CAD in interest. The cheaper alternative is to keep family funds liquid, borrow only the tuition gap, and use the GIC plus part-time work (24 hours per week as of late 2024) for living expenses.

When should you involve an RCIC in your student funding plan?

Short answer: Most students arrange financing themselves with help from their school's international office and a lender. Bring in an RCIC if you are from a sanctions-affected country needing banking-compliance help, have informal family loans that need careful documentation, were refused once for "insufficient proof of funds," or are weighing college against university based on funding options. An RCIC can also confirm your proof of funds meets the current standard processing requirements before you submit.

Most students arrange financing themselves with help from their school's international office and the relevant lender. Engage an RCIC if:

• You are from a sanctions-affected country and need help with banking compliance
• Your funding includes informal family loans that require careful documentation
• You have been refused once for "insufficient proof of funds" and need to rebuild the file
• You want to confirm your GIC, bank statements, or education loan satisfy IRCC's current proof-of-funds standard
• You are weighing the trade-off between college and university based on funding options

Book a free consultation to map out the right funding pathway before you commit to a school.

Which tools help international students calculate their funding needs?

Short answer: Use the Cost of Living Calculator (8 Canadian cities) to size the funding gap, the Document Checklist tool to generate the financial documentation list for a standard study permit, and the Visa Refusal Analyzer if a previous study permit was refused on funds grounds. Pair these with our school-cost guides to decide how much you actually need to borrow before you commit.

• Cost of Living Calculator: see what living expenses actually run in 8 Canadian cities so you can size the funding gap accurately
• Document Checklist: generate the financial documentation checklist for a standard study permit
• Visa Refusal Analyzer: if a previous study permit was refused on funds grounds, analyze the refusal letter before reapplying

What are the most common questions about international student loans in Canada?

Can international students get loans to study in Canada? Not from the Canadian government. Canada Student Loans and provincial student aid are restricted to citizens, permanent residents, and protected persons. International students fund their studies through private channels: a Canadian-bank GIC and newcomer banking program (Scotiabank, CIBC, RBC, ICICI Bank Canada), home-country education loans (HDFC Credila, Itaú, and similar), and international private lenders that need no Canadian co-signer (MPOWER Financing, Prodigy Finance), usually combined with scholarships and family funds.

Is the Student Direct Stream still available in 2026? No. IRCC permanently ended the Student Direct Stream (SDS) on November 8, 2024. Every study-permit application now goes through standard processing under the same rules. There is no separate SDS GIC requirement anymore, though a GIC remains a common and accepted way to prove your living-cost funds.

What is the GIC proof-of-funds figure for Canadian study permits in 2026? About $20,635 CAD for a single applicant, with higher amounts for accompanying family members. A Guaranteed Investment Certificate of that value, held at a participating Canadian bank, is a widely accepted way to show living-cost funds. It covers roughly your first year, is released in monthly installments after you arrive, and is your own money rather than a loan. IRCC adjusts the benchmark over time, so confirm the current figure before applying.

Which Canadian banks offer the GIC for study permit applicants in 2026? Scotiabank (StartRight Program), CIBC, RBC Royal Bank, and ICICI Bank Canada are the most popular options. HSBC Canada has closed in Canada (acquired by RBC) and existing accounts were transferred. Most banks require either an in-person Canadian branch visit or a verified onboarding session from your home country before disbursing funds.

Can I get a Canadian government student loan as an international student? No. Federal Canada Student Loans and grants and provincial student loans are restricted to Canadian citizens, permanent residents, and protected persons. International students cannot access government-backed Canadian student aid until they obtain PR status. After PR (typically 1 to 3 years post-graduation through Express Entry or a PNP), government aid and Canadian-bank refinancing both become real options.

Does MPOWER Financing work for Canadian schools? Yes. MPOWER lends to international students at 200+ Canadian schools with no co-signer required. Typical interest rate is 13 to 15% APR fixed, with loan amounts up to $100,000 USD lifetime. It disburses directly to the school.

Is Prodigy Finance available for Canadian programs? Yes, but only for master's and PhD programs at specific eligible Canadian schools (mostly the U15 universities). Variable rate around 10 to 13% APR. No co-signer required.

What interest rates should I expect on an international student loan in 2026? Home-country bank loans (India, Brazil, Mexico): 9.5 to 12.5% per year. International private lenders (MPOWER, Prodigy): 10 to 15% APR. Canadian-bank tuition lines of credit (after PR): 6 to 9%. Refinancing within 1 to 2 years of arriving and getting Canadian employment is the standard cost-reduction play.

Can I work while studying to cover living expenses? Yes. Study permits allow up to 24 hours per week of off-campus work during academic terms (increased from 20 hours in late 2024) and full-time during scheduled breaks. On-campus work has no hour cap. Median student wages in Toronto, Vancouver, and Montreal run $17 to $22 CAD per hour, which translates to roughly $1,700 to $2,100 CAD per month at 24 hours per week.

Do I need IELTS to study in Canada? Not always. Standard study-permit processing does not impose the fixed IELTS band that SDS once required, and a number of Canadian schools accept alternative proof of English. See our guide to studying in Canada without IELTS for the pathways that qualify.

Sources

• Study permit: Get your documents ready (proof of financial support) (IRCC) - the proof-of-funds and living-cost figure for study permit applicants, plus the GIC option
• Study permit (IRCC) - the current study-permit application process under standard processing
• Student aid: Canada Student Grants and Loans (Government of Canada) - federal student financial assistance, restricted to citizens, permanent residents, and protected persons
• Work off campus as an international student (IRCC) - the off-campus work hours allowed while studying

Written by Rami Mamar, RCIC-IRB (License #R515110). Last reviewed June 2026 against IRCC's current study-permit and proof-of-funds guidance, including the November 8, 2024 end of the Student Direct Stream. This article is general information, not legal advice. For a funding and study-permit plan tailored to your country and program, book a consultation with a licensed RCIC.