Interest-Free Student Loans in Pakistan: What's Open in 2026

When a scholarship doesn't cover everything, or doesn't come through at all, many Pakistani families look for a loan. Bank education loans charge markup, often well above inflation, which is why most families prefer a Qarz-e-Hasna: a loan where you repay exactly what you borrowed and nothing more.

There are only a few of these for students, and some of the names that come up in searches are no longer taking applications. This guide sets out which interest-free loans you can actually apply for in October 2026, who each one is for, and what repaying it involves.

A loan is not a scholarship

This sounds obvious, but it is the most common misunderstanding. "Interest-free" means there is no markup. It does not mean you never pay it back. Every scheme below expects the full amount back, usually in monthly instalments after you graduate, and most need a guarantor who becomes responsible if you stop paying.

So try grants first. Need-based scholarships such as the HEC Need-Based Scholarship, the Benazir Undergraduate Scholarship and Pakistan Bait-ul-Mal's educational assistance never have to be repaid. Our list of need-based scholarships collects all of them in one place. A loan makes the most sense for the gap that is left over.

Ihsan Trust: tuition loans at partner universities

Ihsan Trust's Qarz-e-Hasna is the scheme most students in Pakistan can actually use today. It pays up to half of your tuition, and up to 75% where the need is greater, directly to your university. You repay only the principal, in small monthly instalments after you graduate.

• Who can apply: bachelor's, master's, MS and PhD students at an Ihsan Trust partner university. Partner universities have published minimum grades such as a CGPA of 2.5 for undergraduates, 2.7 for MS and 3.0 for PhD.
• How: register on the Ihsan Trust portal or collect the form from your university's Financial Aid Office, submit your family documents, and attend an interview.
• Watch out: it only covers the first attempt at each course, and you usually can't hold another scholarship at the same time.

If your university is not a partner, ask its Financial Aid Office anyway. Many run their own interest-free loan funds alongside scholarships.

PAK-EEF: loans for a master's or PhD at a top-25 university abroad

The Pakistan Education Endowment Fund (PAK-EEF), set up under the Prime Minister's education initiative, gives interest-free loans to Pakistanis admitted to an MS or PhD at a university in the top 25 of the QS World University Rankings. It can pay part of the tuition, a monthly living stipend, a return air ticket and health insurance.

• Subjects: artificial intelligence, data science, cyber security, renewable energy, climate change, biotechnology, space sciences, and engineering and technology.
• Who can apply: Pakistani citizens without dual nationality who have already secured admission. PAK-EEF looks at financial need through BISP and NADRA, and gives preference to women and to applicants from less developed districts.
• Repayment: the full amount over up to 10 years after you finish, monthly, quarterly or yearly.
• Guarantor: a blood relative (parent, sibling, uncle, aunt or grandparent) whose financial standing is certified by a grade 17 or higher government officer. The guarantor is equally liable if you default.

PAK-EEF's own page gives different age and grade limits in different places (for example, a CGPA of 3.0 in one section and 3.5 in another), so confirm the current rules with PAK-EEF before you apply. Applications are made online at scholarships.peef.pk.

NBP Student Loan Scheme: not taking applications

The government's Student Loan Scheme, run by the National Bank of Pakistan, is the name most parents remember. It gave interest-free loans to students at public-sector universities in science, engineering, medicine, IT, business and some other subjects, with repayment over up to 10 years.

However, the most recent round we could find closed on 29 July 2022, for the 2020-21 and 2021-22 sessions, and NBP has not announced a new one. If someone asks you to pay a fee for an "NBP student loan form" today, treat it as a scam. If the scheme reopens, the forms will be on NBP's own website and submitted at the NBP branch assigned to your university.

Akhuwat: through your university

Akhuwat is Pakistan's best-known interest-free lender, and it lists education among its loan types. For university students it has mostly worked through agreements with institutions. For example, IBA Karachi signed a five-year agreement with Akhuwat in 2021 for interest-free loans of up to PKR 125,000 for third- and fourth-year students. Ask your Financial Aid Office whether your university has a similar arrangement.

Be careful online. Many websites copy Akhuwat's name and logo to collect "processing fees" and CNIC copies. Akhuwat's official site is akhuwat.org.pk. Genuine interest-free lenders never ask for money before a loan is approved. Our guide to avoiding scholarship scams explains the warning signs.

Before you sign any loan agreement

Sit down with the person who will be your guarantor and go through these questions together:

1. What is the total amount? Add up every semester, not just the first.
2. When does repayment start, and how much is each instalment? Check that a starting salary in your field can cover it.
3. What happens if you fail a course or take a break? Some loans stop, and some become due at once.
4. What does default mean? PAK-EEF, for example, can demand the whole amount plus a penalty, and the guarantor becomes liable.
5. Can you combine it with a scholarship? Ihsan Trust and others usually say no, so decide which helps more.

Where to go from here

Start with the free money: use the eligibility checker to see which scholarships you qualify for, and browse scholarships for studying in Pakistan. Then use the cost calculator to work out how big the gap really is before you borrow to fill it.