How to Get a Student Loan in Armenia: Banks, Terms, and Tips

Higher education in Armenia is paid in almost every university. Even if a family has financially prepared in advance, studying at a university or college can cost anywhere from hundreds of thousands to several million AMD per year. That’s why many students and their parents apply for a student loan — it allows them to spread the cost over several years and not give up on quality education due to financial difficulties.

In Armenia, you can take out a student loan under a state-subsidized program, where for the first few years you only pay interest, and the principal is repaid after graduation. If you choose the right bank and repayment schedule, the total overpayment can be 2–3 times lower than with a regular consumer loan.

What is a Student Loan?

A student loan is a targeted loan issued by a bank to pay for education at a university or college.

Key features:

1. The funds are not transferred to the student but directly to the educational institution.
2. Targeted use only — tuition fees, not rent, gadgets, or other personal expenses.
3. You can defer repayment of the principal — during your studies, you pay interest only.

You can read more about student loans in our dedicated article on this topic.

How Is a Student Loan Different from a Regular Consumer Loan?

To understand why student loans are considered a cost-effective tool, it's important to compare them with standard consumer loans.

The difference lies not only in the interest rate, but also in the repayment structure: student loans allow deferred repayment of the principal, and if chosen wisely, the overall overpayment is significantly lower.

Conclusion: A student who takes out a loan with state support pays only interest while studying – and that interest is significantly lower than on standard loans.

Top 5 Banks in Armenia Where It’s Easiest to Get a Student Loan

Choosing the right bank is half the success when applying for a student loan.

Some banks make the process as simple as possible: all you need is a passport, an agreement with the university, and a tuition invoice. In some cases, approval takes just a few days.

Below is a list of the top 5 banks in Armenia where applying for a student loan is the easiest — minimum paperwork, fast application review, and transparent terms.

Tip: Banks offering lower rates (below 7%) often limit the loan amount or duration. If your education is expensive or long-term, it may be smarter to combine a subsidized loan with a commercial one.

Banks Offering Commercial Student Loans in Armenia

If you're not eligible for the state-subsidized program — for example, you need a larger sum or plan to study abroad — you can still apply for a commercial student loan.

When does a commercial student loan make sense?

1. Your study program is short (1–2 years), and you plan to repay the loan quickly
2. You have a stable income
3. You need a loan amount above the limits of the state program

How to Combine a Subsidized and Commercial Student Loan in Armenia

Start by applying for a subsidized student loan under the state program for the maximum amount allowed by your chosen bank (up to 5 million AMD).

For example, Byblos Bank Armenia or Converse Bank offer effective rates between 5% and 7%.

These funds can cover the main portion of your tuition and come with a grace period — during your studies, you pay interest only.

Use a Commercial Loan for the Remaining Tuition

This strategy is especially useful if:

1. The semester is particularly expensive, or
2. You're pursuing a multi-level program (e.g., bachelor's + master's degree)

You can apply for the commercial loan at the same bank (which is often simpler paperwork-wise) or at another bank offering a better rate or higher limit.

Optimize Your Repayment Schedule

1. The subsidized loan allows you to defer principal payments until after graduation.
2. The commercial loan should ideally be repaid quickly to minimize overpayment, as its rate is usually higher (16%–24%).

Example Loan Structure

Scenario:

1. Total tuition: 5,000,000 AMD over 4 years
2. Byblos Bank Armenia (state loan): up to 3,200,000 AMD at 5.11%–8.35%
3. Acba Bank (commercial loan): up to 5,000,000 AMD at 19.61%–22.56%

How it works:

1. 3,200,000 AMD is issued as a subsidized loan through Byblos Bank Armenia
2. During studies: pay interest only (5.11%–8.35%)
3. Repay principal after graduation
4. The remaining 1,800,000 AMD is taken as a commercial loan from Acba Bank
5. Aim to repay it within 1–2 years to reduce total cost

Benefits of This Strategy

1. The main portion of the loan (3.2 million AMD) comes with low interest and a grace period
2. The commercial portion (1.8 million AMD) is repaid quickly to limit interest charges
3. The overall financial burden on the student and family is lower compared to taking out the full amount as a commercial loan

Key Considerations

1. Not all banks allow two simultaneous loans for the same student — check in advance or compare offers from different banks
2. It may be easier to take the subsidized loan in the student’s name and the commercial loan in a parent’s name — this can increase the likelihood of approval
3. If your income is unstable, avoid taking on a double loan burden — ensure your repayment plan is realistic and manageable

Tips to Save Money on a Student Loan?

1. Take out the loan in stages. Banks usually transfer funds per semester or academic year. If you later switch to a state-funded spot, the unused loan amount won't be disbursed.
2. Use the grace period. Under the state program, you can pay interest only until graduation and for 6–9 months afterward. This significantly eases the financial burden.
3. Pay attention to the effective interest rate. It includes all fees, insurance costs, and real expenses. At AFM, we only list the effective rate, not just the nominal one.
4. Make early repayments when possible. Even small prepayments can noticeably reduce your overpayment.
5. Compare multiple banks. Even a 1% difference in interest rate can save you tens of thousands of AMD over the full loan term.

How to Apply for a Student Loan: Step-by-Step Guide

1. Choose a bank and loan program.
2. You can use AFM to compare all available offers in one place.
3. Prepare your documents:
4. Passport
5. University or college agreement
6. Tuition invoice
7. Parental consent (for applicants under 18)
8. Submit your application:
9. Online via the bank’s website or through AFM
10. Or directly at the bank branch
11. Wait for approval (typically 3–5 days) and sign the loan agreement.
12. The bank will transfer funds directly to the educational institution.

FAQ: All About Student Loans in Armenia

1. Can I apply for a student loan if I’m already enrolled, not just starting my studies?

Yes. You can apply at any time — even in your final year — if you need help covering tuition.

2. Who is eligible for a student loan?

Any Armenian citizen enrolled in a university or college. If you're under 18, you’ll need written parental or legal guardian consent.

3. Do I need to prove income, provide collateral, or find guarantors?

No. Student loans under most programs do not require income proof, collateral, or guarantors.

4. How does the bank transfer the loan funds?

Funds are transferred directly to the educational institution based on the bank details provided in your university agreement. The loan cannot be used for personal expenses.

5. What if I take academic leave?

You must notify the bank. The grace period will be adjusted, and repayment of the principal will start later. However, you'll still need to pay interest during the leave.

6. Can I repay my student loan early?

Yes. Early repayment is allowed without penalties and helps reduce total interest paid.

7. What happens if I miss a payment?

The bank will charge a late fee, the incident will be reported to your credit history, and in case of extended delinquency, the bank may demand full repayment of the loan.

8. What if I get expelled?

You’ll lose the preferential interest rate. The bank will switch the loan to a standard market rate and issue a new repayment schedule.

9. Can I extend the loan if I continue my studies (e.g., move from bachelor's to master's)?

Yes. Most banks allow you to increase the loan amount and extend the term once if you progress to the next level of education.

10. Are there any tax benefits for students paying for education?

Yes. If you're officially employed, you can get part of your tuition back through a personal income tax refund under the social tax deduction system.

Conclusion

A student loan makes it possible to receive the education you want without overwhelming financial pressure.

The state-subsidized program offers an effective interest rate starting from 5.11%, a grace period for the entire duration of your studies plus up to 9 months, and can reduce overpayment by 2–3 times compared to standard consumer loans.

Commercial student loans with rates of 16–24% are suitable for more expensive programs or studying abroad, but require fast repayment to avoid excessive interest.

A combined strategy — for example, 3.2 million AMD from a subsidized loan and 1.8 million AMD from a commercial loan — allows you to cover up to 5 million AMD over 4 years with minimal impact on the family budget.

Smart tactics like taking loans in stages, early repayments, and choosing banks with low effective rates can save tens or even hundreds of thousands of AMD over long periods.

A student who combines loans wisely and takes full advantage of grace periods can finance a 5 million AMD education and still repay less than someone who takes a 3 million AMD consumer loan at standard rates.

Compare student loan options from all Armenian banks in one place on AFM and choose a strategy that helps you save money and focus on your education — not your payments.