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Education Loans for Students in India | How To Get Right Study Loan

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Education Loans for Students in India

An Education Loans for Students in India can be a saving grace for needy but eligible students to accomplish higher education in reputed professional institutes or Universities. Student loans commonly called as Education loans or higher education loans which are financial relieves to students provided by the Private financial institutions, Banks and Government organization. The process of getting education loan is simple but you need to know How to Get Right Study Loan for your intelligent and desiring wards.

Educational costs for higher studies have augmented to such an amount in the last couple of years that it has become hard for the middle class as well as upper middle class to borne the educational expenses by their own. Thus student’s loans come in useful way for people with financial restraints to a large amount.

 Education Loans for Students

Many of public sector/ nationalized banks like State Bank of India and private sector banks like ICICI and HDFC etc. recommend educational loans for students to learn in India and abroad with changeable stipulations. Students can move toward these banks with some initial information about the schemes and hit the right deal for them.

Here on this page of recruitmentresult.com, we have provided much information in concern to educational loan for students in India such as the list of interest charged by banks, documents required, eligibility, hurdles, expenses considered by bank etc. So it is advised to read complete details given in the underneath section of this page before applying for student loan.

Education Loans for Students in India

Eligibility Criteria:

  • Must be a citizen of India.
  • Age Limit varies with different Banks.
  • Your course and University should be eligible for Loan.
  • If loan amount is above Rs 4 Lakh, then you will need a guarantor.
  • No outstanding education loan from any other association.
  • Marks scored in 10+2 must be above 60% for general category and 50% for SC / ST / OBC category.
  • Branch nearest to student’s residential permanent address.

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Obstacles faced by students while pertaining for education loan:

  • Increasing cost of education will indirectly relate to limitations on maximum loan amount. In some cases, tuition fees incurred for pursuing higher education abroad is minimum Rs 25 lakhs, while the maximum loan available is Rs 20 lakhs only.
  • Education loan is made accessible in specific branches only. Hence the applicant may not be able to acquire the loan from branches outside of home town.
  • If you want to get loan for studies in abroad then you have to arrange minimum margin amount for education loan for abroad that is 15 percent charged by bank.
  • Deadly documentation and troublesome education loan process.

You may also read:-  Documents Required For Education Loan

Expenses covered under Education Loan:

  • Admission as well as Examination Fees payable at college/ school/ hostel
  • Examination /Library/ Laboratory fee
  • Acquisition of books & equipment’s/ instruments/ uniforms
  • Prudence deposit/ building fund/reimbursed deposit maintained by Institution bills/receipts
  • Travel expenses/ passage money for studies in abroad (loan for two wheeler up to Rs.50,000/- could be granted by bank if distance of school and hostel is considerably long)
  • Purchase of computers – essential for completion of the course
  • Insurance cover for the student

Documents Required for Application:

Identity Proof:

  • Driving license
  • Passport
  • Pan card
  • Voter’s identity card
  • A signed verification letter from a recognized public authority or public servant for your identity and residence.
  • Aadhar card

Address Proof:

  • Passport
  • Bank account statement
  • Ration card
  • Aadhar card
  • Voter’s ID card
  • Telephone bill/ water bill/ electricity bill
  • Allotment letter issued by a government department

Signature Proof:

  • The banker’s signature verification
  • Driving license
  • PAN card
  • Passport copy

Also Read:- Education Loan For Abroad Studies

Banks offering Education Loans for Students in India:

Here are some list of Private Sector banks, Public Sector Banks as well as Foreign Banks in India which provides Education loan to students according to their ease.

Andhra BankBank of BarodaBank of Punjab
Allahabad BankBank Of IndiaBank of Maharashtra
Axis BankBank of RajasthanBassein Catholic Bank
Bharat Overseas BankCanara BankCatholic Syrian Bank
Central Bank of IndiaCenturion Bank of PunjabCiti Bank
City Union BankCorporation BankDena Bank
Development Credit BankDhanaLakshmi BankFederal Bank
HDFC BankIndian BankICICI Bank
HSBCIndian Overseas BankIDBI Bank
ING Vysya BankJammu & Kashmir BankKarnataka Bank
Karur Vyasa BankPunjab & Sind BankOriental Bank of Commerce
Lakshmi Vilas BankPunjab National BankRatnakar Bank

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How to apply for Education Loan for Students in India:

Applicants who find themselves eligible for acquiring educational loan must have the above mentioned documents in hand at time of applying for loan. Contenders need to follow some simple steps:

  • Aspirants who want to apply for loan must have a bank account. In case, if you don’t have an account you must open it in the bank.
  • Once you have determined to study at an institution and finished the process of admission, then you will have to concentrate on amount of educational loan and overall expenses incurred for education.
  • Go to the bank and ask for education Loan form. Read all terms and condition carefully and fill it properly. If you have any doubt you can ask the bank employees.
  • Get all your supporting documents ready and the attested copies of the original documents. The documents required are mentioned above.
  • Submit the application form and wait till your application gets approved.
  • After submission and verification of all the documents, you will have to appear for an interview.
  • It takes around 15 days for an educational loan to be sanctioned. Once it has been approved, you will get a promissory note which you will have to sign.
  • Once your application is approved the required loan amount will be deposited directly to your bank account or in some cases banks pay the institution directly.
  • If it’s rejected, then they will tell you the reason. If there is an error in the form, then you can submit it again after correcting the error.

List of Interest Rate Charged by Bank

Bank1 Year to < 2 years2 Years to < 3 years3 Years to < 5 yearsMore than 5
Allahabad Bank8.75%8.50%8.50%8.00%
Andhra Bank9.25%8.50%8.60%8.00%
Axis Bank9.25%8.50%8.50%8.50%
Bank of Baroda9.35%9.00%8.50%8.50%
Bank of India9.25%8.25%8.25%7.00%
Bank of Maharashtra8.30%8.60%8.60%8.30%
Canara Bank9.10%9.25%8.75%8.75%
Central Bank of India9.25%8.75%8.80%8.80%
Dena Bank9.00%9.00%9.00%8.75%
HDFC Bank8.50%9.25%8.25%8.25%
ICICI Bank9.25%9.25%8.75%8.75%
IDBI Bank9.25%9.25%9.00%9.00%
Indian Bank9.50%8.50%8.50%8.00%
Indian Overseas Bank9.25%8.75%9.00%9.00%
Indus Ind Bank9.00%8.75%9.50%8.75%
J&K Bank9.50%8.75%8.50%8.50%
Karnataka Bank9.75%9.50%9.25%8.75%
Karur Vysya Bank10.25%9.75%9.00%9.00%
Kotak Bank9.25%9.40%9.25%9.25%
Punjab and Sind Bank9.55%9.60%9.05%8.75%
South Indian Bank9.75%8.75%8.75%8.25%
State Bank of India8.75%9.25%8.25%8.50%

PNB Education Loan Scheme-  Check Here

Reimbursement of loan:

Applicants need to recompense the educational loan in Course period + 1 year or 6 months after getting job, whichever is prior. The loan is to be repaid in 10years to 12 years after commencing of installments of loan. If the candidate is not able to finish the course within the planned time, additional time for completion of course may be allowable for an utmost period of 2 years.

Maximum Loan LimitRepayment Period
Upto Rs. 4 LacsUpto 10 years
Above Rs. 4 Lacs and upto Rs. 7.5 LacsUpto 10 years
Above Rs. 7.5 LacsUpto 12 years

Education Loan provides an opportunity for better study to the students that belong to lower or middle class families. Usually such families can’t afford the cost of higher studies or studying abroad. In this case banks help such students by providing loan at lesser interest rates. Banks also provide enough time to pay the installments as they get a job after completion of study.

This loan facility provided a ray of hope to those students whose academic record is excellent but they can’t study further due to financial instability. Most of the banks in India provide education loans and some of them even tied up with some major universities and institutes as a loan provider. Eligibility, documents required and procedure to get loan is described above.

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