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Education loans

Government of India in consultation with Reserve Bank of India (RBI) and Indian Banker's Association (IBA) has framed a Comprehensive Educational Loan Scheme to ensure that no deserving student in the Country is deprived of higher education for want of finances. The new scheme covers all type of courses including professional courses in schools and colleges in India and abroad. The Salient features of the scheme are as under:
  • The scheme envisages loans up to Rs.7.5 lakh for studies in India and up to Rs. 15 lakh for studies abroad.
  • For loans up to Rs. 4 lakh no collateral or margin is required and the interest rate is not to exceed the Prime Lending Rates (PLR). For loans above Rs. 4 lakh the interest rate will not exceed PLR plus 1 percent.
  • 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

Eligible Courses
All courses having employment prospects are eligible.

  • Graduation courses/ Post graduation courses/ Professional courses
  • Other courses approved by UGC/Government/AICTE etc.

Expenses considered for loan

  • Fees payable to college/school/hostel
  • Examination/Library/Laboratory fees
  • Purchase of Books/Equipment/Instruments/Uniforms
  • Caution Deposit/Building Fund/Refundable Deposit (maximum 10% tution fees for the entire course)
  • Travel Expenses/Passage money for studies abroad
  • Purchase of computers considered necessary for completion of course
  • Cost of a Two-wheeler upto Rs. 50,000/-
  • Any other expenses required to complete the course like study tours, project work etc.

Amount of Loan

  • For studies in India, maximum Rs. 10 lacs
  • Studies abroad, maximum Rs. 20 lacs

Processing Fees

  • No processing fee/ upfront charges

Interest Rates (For SBI)

SBI standard Interest: 11.75%

Loan Amount Rate of Interest
Loans upto Rs. 4.00 Lacs 0.50% below SBAR i.e. 11.25% p.a.
Loans above Rs. 4.00 Lacs and upto Rs. 7.50 Lacs 1.00% above SBAR i.e. 12.75% p.a.
Loans above Rs. 7.50 Lacs At SBAR i.e. 11.75% p.a.

An Interest Rate concession of 0.50% to Girl Student availing Student Loans

Repayment Tenure
Repayment will commence one year after completion of course or 6 months after securing a job, whichever is earlier. Normal Repayment Period will be 5-7 years

Repayment Tenure

Amount For loans upto Rs. 10.00 lacs for Studies in India and upto Rs. 20.00 lacs for studies abroad
Upto Rs. 4 lacs No Security
Above Rs. 4 lacs to Rs. 7.50 lacs Collateral security in the form of suitable third party guarantee. The bank may, at its discretion, in exceptional cases, weive third party guarantee if satisfied with the net-worth/means of parent/s who would be executing the documents as "joint borrower".
Above Rs. 7.50 lacs. Tangible collateral security of suitable value, along with the assignment of future income of the student for payment of installments.

All loans should be secured by parent(s)/guardian of the student borrower.
In case of married person, co-obligator can be spouse or the parent(s)/ parents-in-law


  • For loans up to Rs.4.0 lacs : No Margin
  • For loans above Rs.4.0 lacs:
    • Studies in India: 5%
    • Studies Abroad: 15%


  • Completed Education Loan Application Form.
  • Mark sheets of last qualifying examination
  • Proof of admission scholarship, studentship etc
  • Schedule of expenses for the specified course
  • 2 passport size photographs
  • Borrower's Bank account statement for the last six months
  • Brief statement of assets and liabilities, of the Co-borrower (Parents)

*Since the rules, regulations, eligibility conditions, repayments and interests rates etc are different for different banks and also revised from time to time in keeping pace with the changing capital market conditions, students and parents are advised to thoroughly check the terms and conditions of educational loan scheme on offer at the time of application.

The Reserve Bank of India (RBI) has also issued guidelines about Education loan to all commercial banks. A large number of banks have already launched educational loan schemes. Provided below are links to the respective website of individual banks offering such facilities. Also provided in the appendix below is the guidelines given by Reserve bank of India in its communication to all the commercial banks .

List of banks & Web links

S. No Name of Bank Link for education loan
1 State bank of India
2 Axis bank
3 Bank of Baroda
4 Allahabad bank
5 Bank of india
6 Bank of Maharashtra
7 Central bank of India
8 HDFC bank
9 IDBI bank
10 Indian bank
11 Kerala State Cooperative Bank ltd.
12 HSBC bank
13 ICICI bank
14 State bank of Patiala
15 Syndicate bank
16 UCO bank
17 United bank of India
18 Union bank of India
19 Punjab National Bank
20 Andhra Bank
21 Bharat Overseas Bank
22 Corporation Bank
23 Dena Bank,4,26,68
24 DCBL Bank
25 Dhanalakshmi Bank
26 Federal Bank
27 Indian Overseas Bank
28 Jammu and Kashmir Bank
29 Karnataka Bank
30 Karur Vysya Bank
31 Lakshmi Vilas Bank
32 Oriental Bank of Commerce
33 Punjab and Sind Bank
34 SBI Commercial and International Bank
35 South Indian Bank
36 Tamilnadu Mercantile Bank Ltd.
37 The Ratnakar Bank Ltd.
38 Vijaya Bank
39 Canara bank
40 Catholic Syrian Bank Ltd
41 City Union Bank
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