Education Loans in India

Is financial constraint holding you back from achieving your educational dreams? Are you hesitating to pursue your higher education in your dream college or university due to shortage of financial fund? You can now achieve your dream of completing the desired degree by taking advantage of education loans in India. Like all developing countries, India has also created a definite niche in the world economy by providing education loans to the aspiring students.

Who Can Get the Loan?

The banks generally offer loans for management studies, engineering and medical degrees. The banks do not provide loans for students wanting to pursue a general Bachelor's or Master's degree in arts or commerce or for such courses where the prospect of lucrative employment is less.

Eligibility Criteria

• The applicant needs to be an Indian national.
• The applicant should have a secured admission offer letter (for any overseas college or university).
• For Indian universities or colleges, the applicant should have secured admission through proper entrance test or selection process.

Which Banks in India Offer Education Loans?

Most nationalized banks, private banks, foreign banks and private lending institutions provide students loans. Some of the loans from the most popular banks are as follows:

• Axis Bank Study Loan
• Allahabad Bank Loan
• Bank of India Loan
• Bank of Maharashtra Loan
• Bank of Baroda Loan
• Bank of Rajasthan Loan
• Canara Bank Student Loans
• Federal Bank Vidya Loan
• IDBI Bank Education Loans
• HDFC Education Loan
• UCO Bank Education Loan
• ICICI Bank Education Loan
• Punjab National Bank Loan
• Syndicate Bank Loans
• Indian Overseas Bank Loan
• Oriental Bank of Commerce
• State Bank of India Loan
• United Bank of India Loans

Documents required for availing the loan are:

• Mark sheet of last qualifying examination.
• Schedule of expenses for the course
• Offer letter or any other proof of admission to the course.
• Copies of letter confirming scholarships.
• Borrower’s last 6 months’ statement of bank account.
• List and statement of borrower’s assets and liabilities.

How much Loan Can You Get?

For studying in India a student can borrow up to 4 lakh (INR) without providing any margin or security. A loan amount above this and up to 7.5 lakh (INR) is available against a third-party guarantee, which comes with a 5% margin. For studying outside the country, loan amounts above 7 lakh (INR) is sanctioned against NSC certificates, fixed deposits, property, and so on, against a loan margin of 15%.

Education Loan - What It Is

An education or student loan means financial support given by a bank or a financial institute to help a student meet the expenses needed for higher education. Many colleges, universities and other educational institutions have tied up with private and nationalized banks to help the students achieve their dreams. For studying in any institute within the country, the maximum loan amount granted is 7.5 lakh (INR) and for studying abroad, the maximum loan amount granted is 15 lakh (INR).
In India, if a student is under 18 years of age, an education loan is granted to the parents. Loans are also granted through third-party guarantee, who can be a relative, friend or neighbor. Students, above 18 years of age get loans to meet their professional or academic education costs. Compared to other types of loans, education loans in India come with lower interest rates. Sometimes, the loans are supplemented by student grants, which in general cases do not have to be repaid. Most nationalized and private lending institutions in India need authorization from the respective college or university. These education loans generally include the costs of tuition fee, hostel expense, and books & stationery costs.