The interest rates for educational loans in India are very high. In many cases, the interest rate for educational loans exceeds the interest rates for home or car loans. These higher interest rates sometimes demotivate a student. Many may look for alternatives or search for educational loans with zero interest rates. So, is it possible to get an educational loan with a 0% interest rate? Let’s take a look.
Education Loan at 0% Interest Rate
In India, there is no educational loan available with a 0% interest rate. However, there are few other ways that you can adopt to make lessen the impact of the educational loan interest rate. Some of these methods are mentioned below:
Scholarship: You can reduce the impact of interest by applying for scholarships. Various scholarships are available depending on the study and institute of your choice. You can look them up and apply for the ones that are relevant to you. Even with ordinary scholarships, you may at least pay off the loan’s interest, making it less of a financial burden for you and your family. Many scholarships offered by foundations such as Tata trust, KC Mahindra trust, and others essentially offer 0% interest.
Central sector subsidy scheme: If your family’s annual income is less than Rs.4.5 lakhs, the government will pay your interest for the moratorium period, which is the course length plus 6 months/1 year. Only after a year of stability in your job/business after the training should you begin repaying. Until then, no interest is paid. However, this scheme is only applicable for loans obtained from a scheduled bank.