Make college memories that last a lot longer than your student loan payments.
If you are searching for an education loan, the interest rates for such loans range from 8.45% to 15.2% pa. and come with flexible tenures up to 15 years. The amount that you can borrow can be Rs. 1.5 crore or more depending on the banks policies. Education loans can also be used to gain tax benefits under Section 80 (E).
Mentioned below is the general eligibility criteria for education loans in India:
| Age |
|
| Courses eligible |
|
| Institutes eligible |
|
An education loan is designed to financially aid the applicant in affording the cost of education. Since, the it caters to customers going for higher studies, the loans can be classified based on two parameters:
Education costs are on a steady rise. In such a scenario, getting an education loan helps the applicant gain access to quality education at premier institutions whether in India or abroad. Apart from the tuition fees, education loans also help the applicant with the living costs and any other study related expenses.
Mentioned below are a few important reasons why you should opt for an education loan:
Mentioned below is the general eligibility criteria for education loans in India:
An education loan can be both secured and unsecured based on the bank or NBFC offering it. Usually lenders do not require collateral for smaller loan amounts. However, if the loan amount exceeds the limit specified by lenders, the applicant may have to provide security.
Securities may vary based on the kind of loan, for instance some loans can be taken with collaterals like agricultural property, house, etc. Some loans can also be taken against funds, debentures, fixed deposits, etc
The loan repayment period usually starts a year after completing the specified course. Different lenders provide different modes for the applicants to repay the loan, mentioned below are few repayment options:
The preferred method of repayment varies between lenders. Therefore, it is advisable to check with your lender when taking the loan.
Follow these steps mentioned below to make the loan application process a seamless process:
Mentioned below are some of the well-known education loan providers and what they are best for:
| Banks | Best For |
|---|---|
| State Bank of India | Low interest rates |
| Axis Bank | Quick loan disbursal |
| Punjab National Bank | Low interest rates |
| Avanse Education Loan | No limit on loan amount |
SBI offers different education loans to meet the requirements of the applicants. The bank offers loans that helps students study in Indian institutes, to pursue education abroad, and even go for vocational courses.
Key Highlights:
| Interest Rate | Loan tenure | Maximum loan amount |
|---|---|---|
| 8.45% to 10.70% p.a. | 15 years | Up to 1.5 crore |
Axis Bank’s education loan helps applicants afford education in India as well as abroad. The bank offers a wholesome coverage for tuition as well as living expenses.
Key Highlights:
| Interest Rate | Maximum loan amount | Pre-payment charges |
|---|---|---|
| 13.7% to 15.2% p.a. | Up to Rs.75 lakhs | Nil |
Punjab National Bank offers numerous education loans designed for higher studies in India and abroad. The bank also offers loans for vocational training and concessional loans for people with disabilities.
Key Highlights:
| Interest Rate | Loan tenure | Maximum loan amount |
|---|---|---|
| 8.95% to 12.45% | Up to 15 years | Based on course and repayment capacity |
Avanse Education Loans provide 100% coverage on all education related expenses. The lender does not enforce a margin on the loan amount and offers various plans to meet the requirements of the applicants.
Key Highlights:
| Interest Rate | Loan tenure | Maximum loan amount |
|---|---|---|
| 10% to 16.65% | Up to 10 years | No limit |
The following documents and information must be provided when applying for a student loan:
| Documents | For Study abroad loans | For Domestic loans |
|---|---|---|
| Proof of Identity and age |
|
|
| Proof of Address |
|
|
| Income proof |
|
|
| Education proof |
|
|
| Other documents |
|
|
Generally, the age limit for getting an education loan is 30 years.
Lenders consider the following factors when approving a loan:
Some of the courses eligible for education loan are mentioned below:
The repayment period begins after you complete the course. The tenure may vary from one lender to another.
In case you choose to discontinue the course mid-way, you must start repaying the loan immediately after getting a job.
Yes, education loans are eligible for tax benefits. You can avail deductions under sections 80C and 80E of the Income Tax Act of 1961.
Yes, you can move your education loan from one bank to another. However, your current bank might charge a refinance fees. Therefore, it is important to consider all factors of the existing bank and the new bank before moving the loan.
While rejecting a loan application, banks usually provide a reason why it has been rejected. You can rectify the error and re-apply. However, if the bank did not provide any valid reason for the rejection, you can file RTI petition.
Yes, education loans cover 100% of the education expenses. However, full coverage may only be provided for expenses under a certain limit. Lenders have a margin if the expenses go above the limit.
Some of the additional expenses covered by education loans are:
Display of any trademarks, tradenames, logos and other subject matters of intellectual property belong to their respective intellectual property owners. Display of such IP along with the related product information does not imply BankBazaar's partnership with the owner of the Intellectual Property or issuer/manufacturer of such products.
