What is Education Loan?
Holiday Period
What security does one needs to provide for the loan?
ELIGIBILITY CRITERIA:
Student eligibility:
1) Should be an Indian National
2) Secured admission to professional/ technical courses in India or Abroad through Entrance Test/ Merit Based Selection process.
Courses eligible
a. Studies in India:
1) Graduation courses: BA, B.Com. B.Sc. etc.
2) Post Graduation courses: Masters & PhD.
3) Professional courses: Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Computer etc.
4) Computer certificate courses of reputed institutes accredited to Dept. of Electronics or institutes affiliated to university.
5) Courses like ICWA, CA, CFA etc.
6) Courses conducted by IIM, IIT, IISc, XLRI. NIFT etc. Regular Degree/Diploma courses like Aeronautical, pilot training, shipping etc., approved by Director General of Civil Aviation/Shipping, if the course is pursued in India. In case the course is pursued abroad, the Institute should be recognized by the competent local aviation/shipping authority
7) Courses offered in India by reputed foreign universities.
8) Evening courses of approved institutes.
9) Other courses leading to diploma/ degree etc. conducted by colleges/ universities approved by UGC/ Govt. / AICTE/ AIBMS/ ICMR etc
10) Courses offered by National Institutes and other reputed private institutions. Banks may have the system of appraising other institution courses depending on future prospects/ recognition by user institutions.
11) Courses, which are not covered under the criteria mentioned above, individual banks may take a view to consider extending
12) Education loan under the scheme taking into account the future prospects/recognition by user institution.
b. Studies abroad:-
1) Graduation: For job oriented professional/ technical
2) Courses offered by reputed universities.
3) Post graduation: MCA, MBA, MS, etc.
4) Courses conducted by CIMA- London, CPA in USA etc.
Expenses considered for loan :
1) Fee payable to college/ school/ hostel.
2) Examination/ Library/ Laboratory fee.
3) Purchase of books/ equipments/ instruments/ uniforms.
4) Caution deposit, Building fund/refundable deposit supported by Institution bills/receipts, subject to the condition that the amount does not exceed 10% of the total tuition fees for the entire course.
5) Travel expenses/ passage money for studies abroad.
6) Purchase of computers - essential for completion of the course.
7) Insurance premium for student borrower
8) Any other expense required to complete the course - like study tours, project work, thesis, etc.
Documents For an Educational Loan
The general documentation required by the banks for disbursing education loans is usually very simple.
1) The most important among them is proof from the college/institute that the student has a confirmed admission there.
2) The agreement with the students or the parents/guardians,
3) Proof of residence.
4) Proof of age ,
5) Also required are documents to prove that the parents/guardians have a regular source of income, namely, salary statements, IT returns, etc.
6) Lastly, a resume of the student, clearly showing his past academic performances.
Banks & Interest Rates
1. State Bank of India (SBI)
Study Abroad: 11.25%
Study in India: 11.25%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fees payable to college / hostel / Examination / Library / Laboratory fees / Purchase of Books / Equipment / Instruments / Caution Deposit /Building Fund / Refundable Deposit / Travel Expenses / Passage money /Purchase of computer.
2. Canara Bank
Study Abroad: 10.25%
Study in India: 10.25%
Cost covered: Course fees, purchase of books, equipments, instruments, payment of hostel fees, examination fees, study tours, passage expenses.
3. Central Bank of India
Study Abroad: 10.00%
Study in India: 10.00%
Cost covered: Fee payable to College/Hostel, Examination / Library / Laboratory, Purchase of books / equipments / instruments, Caution deposit /building fund, Purchase of computer, Travel expenses / passage of money.
4. Allahabad Bank
Study Abroad: 11:00%
Study in India: 11:00%
Repayment starts 1 year after course completion/ 6 months after obtaining employment (whichever earlier).
Cost covered: Fee payable to College/ School / Hostel, Examination/ Library/ Laboratory Fee, Purchase of Books/ Equipments/ Instruments/ Uniforms, Caution Deposit/ Building Fund/ Refundable Deposit supported by Bills/ Receipts of the Institution, Travel Expenses/ Passage Money, Purchase of Computers, Insurance premium for student borrower, Study Tours, Project Work and Thesis.
5. Oriental Bank of Commerce
Study Abroad: 11.25%
Study in India: 12:00%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Admission fee / Monthly fee / Examination fee, Books, equipments, Airfare expenses of hostel, expenses for study tours, project work, and thesis.
6. Vijaya Bank
Study Abroad: 11.00%
Study in India: 11.00%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fee payable to college / hostel / Examination / Library / Laboratory, Purchase of books / equipments / instruments, Caution deposit /building fund, Purchase of computer, Travel expenses / passage money.
7. Bank of Maharashtra
Study Abroad: 10:25%
Study in India: 10.25%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Tuition fees, hostel expenses, purchase of books / equipments / instruments, travel expense.
8. Punjab National Bank
Study Abroad: 10:50%
Study in India: 10:50%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fee payable to College / Hostel, Examination / Library / Laboratory fee, Purchase of books / equipments / instruments, Caution Deposit /Building Fund, Travel Expenses / Passage, Purchase of computers.
9. Bank of Baroda
Study Abroad: 11:00%
Study in India: 11:00%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fees payable to College / Examination / Library / Laboratory / Hostel /Purchase of books / equipments / instruments, Purchase of Computer /Caution deposit / building fund.
10. Bank of India
Study Abroad: 12:00%
Study in India: 12:00%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fee payable to college / hostel / Examination / Library / Laboratory /Purchase of books / equipments / instruments / Caution deposit /building fund / Purchase of computer.
11. Indian Bank
Study Abroad: 12:50%
Study in India: 12:50%
Repayable in 5 - 7 years
Cost covered: Fee payable to college / hostel, exam, purchase of books / equipments, purchase of computer, travel expenses / passage money.
12. HDFC Bank
Study Abroad: 13-14%
Study in India: 13-14%
Cost covered: Fee payable to college/ hostel/ Examination/ Library/ Laboratory, Purchase of books/ equipments/ instruments, Caution deposit/ building fund, Purchase of computer, Travel expenses/ passage money.
13. UCO Bank
Study Abroad: 13.25%
Study in India: 13.25%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Course Fees, Hostel fees, Books, Equipment, Computers, Examination / Library / Laboratory fees, Travel Expense.
14. IDBI Bank
Study Abroad: 12:25%
Study in India: 11.25%
Cost covered: Fee payable to college/hostel, Examination/ Library/ Laboratory, Purchase of books/equipment/instruments, Purchase of computer.
15. Axis Bank
Study Abroad: 15.75%
Study in India: 15.75%
Repayable in maximum 7 years
Cost covered: Tuition fees, hostel charges (if any), cost of books, etc.
An education loan is a form of financial support from any bank or financial institution that enables a student for taking higher education.Availability of the education loan, at the appropriate time will help millions of deserving bright young Indians to achieve their dreams come true. All graduation, post-graduation and professional courses from institutes approved by the state and central government and also from foreign universities are eligible for a loan. Several institutes/ colleges have tied up with various banks, for the benefit of prospective students.Before giving the loan, banks study the viability of the based on personal discussions with the student, family's assets and annual income, the nature of the course and reputation of the institute. In most banks for loans up to Rs. 4 lakh no collateral or margin is required and the interest rate will not exceed the Prime Lending Rates (PLR). For loans above Rs. 4 lakh the interest rate will be PLR plus 1 percent. PLR is a term used to refer the interestank and it may vary with each bank. Some banks offer lower rates to women students or those from specified institutions. Security to the loan depends on the amount. Security is some form of investment (i.e bank deposits, house property etc) that are surrendered to the bank while taking the loan. Security is not needed for loan amounts up to Rs. 4 lakhs. Instead of security, some bank may ask for a third party guarantee (guarantor) for higher loan amounts. There is no need to repay the loan while studying. The repayment starts after you have finished the course or started working. The repayment cannot be delayed for years after the completion of course. The loans are to be repaid over a period of 5 to 7 years with provision of grace period of one year after completion of studies.
Holiday Period
A holiday period is the maximum time given to the student before he/she needs to start paying back the principal loan in Equated Monthly Installments (EMIs). In other words, it is the period between the student's final examination in the course for which the loan was availed and when he/she actually starts paying the EMIs. Typically, holiday periods range from six to 12 months. Take note, however, that if the student starts working immediately after completing the course, he does not enjoy a holiday period. Repayment usually starts six months after the course completion or the commencement of a job, whichever is earlier.
What security does one needs to provide for the loan?
The security depends on the loan amount. It is quite possible that banks may not require security for a loan of up to Rs 25,000, but would require it for amounts greater than that. These limits are usually in slabs that vary with banks. The usual securities that the banks generally take are National Savings Certificates (NSCs), bonds, gold, vehicle, house or property, etc. In addition to these, some banks might also require the applicant to have a life insurance policy equivalent to, or greater than, the loan amount.
ELIGIBILITY CRITERIA:
Student eligibility:
1) Should be an Indian National
2) Secured admission to professional/ technical courses in India or Abroad through Entrance Test/ Merit Based Selection process.
Courses eligible
a. Studies in India:
1) Graduation courses: BA, B.Com. B.Sc. etc.
2) Post Graduation courses: Masters & PhD.
3) Professional courses: Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Computer etc.
4) Computer certificate courses of reputed institutes accredited to Dept. of Electronics or institutes affiliated to university.
5) Courses like ICWA, CA, CFA etc.
6) Courses conducted by IIM, IIT, IISc, XLRI. NIFT etc. Regular Degree/Diploma courses like Aeronautical, pilot training, shipping etc., approved by Director General of Civil Aviation/Shipping, if the course is pursued in India. In case the course is pursued abroad, the Institute should be recognized by the competent local aviation/shipping authority
7) Courses offered in India by reputed foreign universities.
8) Evening courses of approved institutes.
9) Other courses leading to diploma/ degree etc. conducted by colleges/ universities approved by UGC/ Govt. / AICTE/ AIBMS/ ICMR etc
10) Courses offered by National Institutes and other reputed private institutions. Banks may have the system of appraising other institution courses depending on future prospects/ recognition by user institutions.
11) Courses, which are not covered under the criteria mentioned above, individual banks may take a view to consider extending
12) Education loan under the scheme taking into account the future prospects/recognition by user institution.
b. Studies abroad:-
1) Graduation: For job oriented professional/ technical
2) Courses offered by reputed universities.
3) Post graduation: MCA, MBA, MS, etc.
4) Courses conducted by CIMA- London, CPA in USA etc.
Expenses considered for loan :
1) Fee payable to college/ school/ hostel.
2) Examination/ Library/ Laboratory fee.
3) Purchase of books/ equipments/ instruments/ uniforms.
4) Caution deposit, Building fund/refundable deposit supported by Institution bills/receipts, subject to the condition that the amount does not exceed 10% of the total tuition fees for the entire course.
5) Travel expenses/ passage money for studies abroad.
6) Purchase of computers - essential for completion of the course.
7) Insurance premium for student borrower
8) Any other expense required to complete the course - like study tours, project work, thesis, etc.
Documents For an Educational Loan
The general documentation required by the banks for disbursing education loans is usually very simple.
1) The most important among them is proof from the college/institute that the student has a confirmed admission there.
2) The agreement with the students or the parents/guardians,
3) Proof of residence.
4) Proof of age ,
5) Also required are documents to prove that the parents/guardians have a regular source of income, namely, salary statements, IT returns, etc.
6) Lastly, a resume of the student, clearly showing his past academic performances.
Banks & Interest Rates
1. State Bank of India (SBI)
Study Abroad: 11.25%
Study in India: 11.25%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fees payable to college / hostel / Examination / Library / Laboratory fees / Purchase of Books / Equipment / Instruments / Caution Deposit /Building Fund / Refundable Deposit / Travel Expenses / Passage money /Purchase of computer.
2. Canara Bank
Study Abroad: 10.25%
Study in India: 10.25%
Cost covered: Course fees, purchase of books, equipments, instruments, payment of hostel fees, examination fees, study tours, passage expenses.
3. Central Bank of India
Study Abroad: 10.00%
Study in India: 10.00%
Cost covered: Fee payable to College/Hostel, Examination / Library / Laboratory, Purchase of books / equipments / instruments, Caution deposit /building fund, Purchase of computer, Travel expenses / passage of money.
4. Allahabad Bank
Study Abroad: 11:00%
Study in India: 11:00%
Repayment starts 1 year after course completion/ 6 months after obtaining employment (whichever earlier).
Cost covered: Fee payable to College/ School / Hostel, Examination/ Library/ Laboratory Fee, Purchase of Books/ Equipments/ Instruments/ Uniforms, Caution Deposit/ Building Fund/ Refundable Deposit supported by Bills/ Receipts of the Institution, Travel Expenses/ Passage Money, Purchase of Computers, Insurance premium for student borrower, Study Tours, Project Work and Thesis.
5. Oriental Bank of Commerce
Study Abroad: 11.25%
Study in India: 12:00%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Admission fee / Monthly fee / Examination fee, Books, equipments, Airfare expenses of hostel, expenses for study tours, project work, and thesis.
6. Vijaya Bank
Study Abroad: 11.00%
Study in India: 11.00%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fee payable to college / hostel / Examination / Library / Laboratory, Purchase of books / equipments / instruments, Caution deposit /building fund, Purchase of computer, Travel expenses / passage money.
7. Bank of Maharashtra
Study Abroad: 10:25%
Study in India: 10.25%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Tuition fees, hostel expenses, purchase of books / equipments / instruments, travel expense.
8. Punjab National Bank
Study Abroad: 10:50%
Study in India: 10:50%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fee payable to College / Hostel, Examination / Library / Laboratory fee, Purchase of books / equipments / instruments, Caution Deposit /Building Fund, Travel Expenses / Passage, Purchase of computers.
9. Bank of Baroda
Study Abroad: 11:00%
Study in India: 11:00%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fees payable to College / Examination / Library / Laboratory / Hostel /Purchase of books / equipments / instruments, Purchase of Computer /Caution deposit / building fund.
10. Bank of India
Study Abroad: 12:00%
Study in India: 12:00%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Fee payable to college / hostel / Examination / Library / Laboratory /Purchase of books / equipments / instruments / Caution deposit /building fund / Purchase of computer.
11. Indian Bank
Study Abroad: 12:50%
Study in India: 12:50%
Repayable in 5 - 7 years
Cost covered: Fee payable to college / hostel, exam, purchase of books / equipments, purchase of computer, travel expenses / passage money.
12. HDFC Bank
Study Abroad: 13-14%
Study in India: 13-14%
Cost covered: Fee payable to college/ hostel/ Examination/ Library/ Laboratory, Purchase of books/ equipments/ instruments, Caution deposit/ building fund, Purchase of computer, Travel expenses/ passage money.
13. UCO Bank
Study Abroad: 13.25%
Study in India: 13.25%
Repayment starts 1 year after course completion / 6 months after obtaining employment (whichever earlier).
Cost covered: Course Fees, Hostel fees, Books, Equipment, Computers, Examination / Library / Laboratory fees, Travel Expense.
14. IDBI Bank
Study Abroad: 12:25%
Study in India: 11.25%
Cost covered: Fee payable to college/hostel, Examination/ Library/ Laboratory, Purchase of books/equipment/instruments, Purchase of computer.
15. Axis Bank
Study Abroad: 15.75%
Study in India: 15.75%
Repayable in maximum 7 years
Cost covered: Tuition fees, hostel charges (if any), cost of books, etc.
