Canada Set to Increase Cost-of-Living Requirement for International Students

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If you’re considering studying in Canada, be prepared for increased expenses in the coming year. The Canadian government recently raised the cost-of-living requirement threshold for international students from CA$10,000 to CA$20,635.

Starting January 1, 2024, new study permit applicants to Canada must demonstrate financial resources of CA$20,635, in addition to covering their first-year tuition and travel costs. The revised cost represents 75% of the low-income cut-off (LICO), Canada’s urban poverty line, which adjusts annually based on inflation.

The cost-of-living financial requirement is a crucial aspect of Canadian study visa applications. International students need to showcase financial preparedness by proving they have sufficient funds to cover living expenses, tuition, and travel. This can be demonstrated through various means such as bank statements, Guaranteed Investment Certificates (GIC), sponsorship letters, or scholarship/award letters.

A commonly used method is obtaining a GIC from an approved bank for CA$10,000, disbursed quarterly into the student’s account after arriving in Canada. Other options include education loans from approved Indian banks or demonstrating enough financial net worth.

The adjustment in the cost-of-living threshold is aimed at providing international students with a more accurate understanding of the actual living costs in Canada. The government emphasizes that these changes are long overdue and aim to protect students from financial vulnerability and exploitation.

Notably, the CA$10,000 cost-of-living requirement for study permit applicants has remained unchanged since the early 2000s.

Impact on Indian students:

Canada has become a preferred study destination for Indian students, with numbers increasing from 2.6 lakh in 2021 to over 3.6 lakh in 2022. The cost of education in Canada varies, with university tuition ranging around CA$36,100 for international undergraduates and CA$21,100 for international graduate students. Living costs are estimated at CA$15,000 per year for university students.

With the revised cost-of-living requirement, a breakdown example provided shows an increase in the total cost for a single applicant from CA$63,000 to CA$73,735. This adjustment is likely to impact diploma-bound students the most, especially those pursuing one-year programs with increased security deposit requirements.

While this change may not significantly affect Master’s and PhD students, it comes amid ongoing diplomatic tensions between India and Canada, potentially affecting the visa processing volumes, particularly for diploma courses. The increased financial burden may lead to a reduction in visa applicants for diploma programs.

However, the silver lining is the extension of the waiver on the 20-hour-per-week work limit for off-campus employment, allowing certain international students to work beyond the standard limit until April 30, 2024. Despite the potential impact on student flow, Canada continues to be an attractive destination for its work-and-learn opportunities.

As Canada navigates these adjustments, the long-term effects on the number of Indian students applying to Canada remain to be seen.