Make college memories that last a lot longer than your student loan payments.

Education Loan

Education loan is offered by leading banks in India to help students achieve their academic dreams. Education loan Interest rates start from 6.85% p.a. with loan tenures of up to 15 years. Education loans are offered for higher education in both India and abroad.

What courses are eligible for an education loan will be decided by the lender. You can get an education loan for studies starting from Nursery. For higher studies, you can get a loan for full-time as well as part-time courses, and loans for working professionals.

Compare Top Education Loan Offers 2021

Education Loan Schemes Interest Rate (p.a.) Loan Amount Processing Fees
PNB

6.90% to 9.55%

Up to 15 Lakhs 1% of loan amount
SBI

6.85% to 8.65%

Up to Rs.1.5 crore Rs.10,000 + tax
Axis

13.70% to 15.20%

Up to 7.5 Lakh Nil to Rs.15,000 + tax
Bank of Baroda

6.75% to 9.85%

Up to 4 Lakh and above 1% of loan amount up to Rs.10,000
HDFC

9.45% to 13.34%

Max Apr Up to 1.5% of loan amount + tax
Tata Capital

10.99% onwards

Up to 30 Lakh Up to 2.75% of loan amount + tax
Union Bank of India

8.80% to 10.05%

Need-based finance Nil for Indian students 0.50% of loan amount + GST for NRI students
Bank of India

6.85% to 9.35%

For courses in India: Up to Rs.10 lakh For courses abroad: Up to Rs.20 lakh Nil for courses in India Rs.5,000 + other fees for study abroad
Kotak Mahindra Bank Up to 16% For courses in India: Up to Rs.10 lakh For courses abroad: Up to Rs.20 lakh Contact the bank
ICICI Bank

10.50% onwards

For courses in India: Up to Rs.50 lakh For courses abroad: Up to Rs.1 crore Contact the bank
Federal Bank

10.05% onwards

For courses in India: Up to Rs.10 lakh For courses abroad: Up to Rs.20 lakh Contact the bank

Note: These interest rates are effective from 1 September 2020 and are subject to change at the bank's discretion

Depending on the bank or financial institution, you could get a fixed interest rate package or a floating interest rate one. Floating rates are most likely based on the Repo Rate, and a spread may be added to it before offering you the final effective interest rate (EIR).

Types of Taxes
Education Loan

1. Punjab National Bank Education Loan

  • Maximum Loan Amount: Need Based
  • Maximum Loan Tenure: 15 Years
  • Collateral: Nill Up to Rs.7.5 lakh
  • Margin: Nill Up to Rs.4 lakh
  • Offers loans to Indian residents and OCIs/PIOs/students born abroad to Indian parents and want to pursue studies in India.
  • Security will be 125% of loan amount.
  • Moratorium period of 6 months to 1 year after course completion.

2. SBI Education Loan

  • Loan amount up to Rs.20 lakh with concessional rates for female students.
  • Max Loan Tenure: 15 Years
  • Collateral: Nil upto Rs. 7.5 lakh
  • Margin: Nill Up to Rs.4 lakh
  • Moratorium period of 12 months after course completion.
  • Second loan can be availed for completing higher studies.

3. Axis Bank Education Loan

  • Maximum Loan Amount Rs. 1 Core
  • Maximum Loan Tenure: 15 years
  • Margin: Nill Up to Rs.4 lakh
  • Can secure loan before admission based on profile.
  • Loan disbursal within 15 business days from the date the bank receives your complete application.
  • Unsecured loans up to Rs.20 lakh for working professionals.

4. Bank of Baroda Education Loan

  • Maximum Loan Amount: Rs. 80 Lakh
  • Maximum Loan Tenure: 10 –15 Years
  • Collateral: 100% Tangible Security
  • Margin: Nill Up to Rs.4 lakh
  • Education loan available for education from nursery onwards.
  • Get a free debit card on select education loan schemes.
  • Concessional interest rates for female students.

5. HDFC Bank Education Loan

  • Maximum Loan Amount: India: Rs.20 lakh Abroad: Rs.35 lakh without collateral; no limit with collateral
  • Maximum Loan Tenure: 15 Years
  • Collateral: Nill Up to Rs.7.5 lakh
  • Preferential rates offered for admission to top ranking colleges and universities.
  • Education loan abroad covers more than 950 courses in 36 countries.
  • Co-borrower can be from a different city.

6. Tata Capital Education Loan

  • Maximum loan amount of Rs.30 Lakh
  • Maximum Loan Tenure: 6 years
  • Collateral: Nill Up to Rs.4 lakh
  • Choose from 3 EMI plans as per your convenience.
  • Minimal documentation and quick approval of loans.

Education Loan Eligibility

Nationality:
  • Indian citizens
  • Non-Indian Residents (NRIs)
  • Overseas Citizens of India (OCI)
  • Persons of Indian Origin (PIOs)
  • Students born to Indian parents abroad and wish to study in India
Courses:
  • Undergraduate programs
  • Postgraduate programs
  • Doctoral courses and PhDs
  • Certificate courses with 6 months or longer duration
  • Job-oriented courses
  • Technical/diploma/professional courses
Institutes:
  • Recognized institutions and government colleges
  • Private institutes aided by government
  • Professional institutions
  • International colleges and universities
Collateral:
  • Collateral-free loans up to Rs.7.5 lakh from leading lenders
  • Collateral-free loans up to Rs.40 lakh for select courses/institutions from select lenders

Acceptable collateral: Residential or commercial property or plot, fixed deposits, insurance

Loan amount: Up to Rs.1 crore

Education Loan EMI Calculator

If you wish to know your monthly payments upon applying for an education loan or what the total cost of the loan will be, you can use the Education Loan EMI Calculator. By entering a few loan-related details such as the loan amount, tenure, interest rate, and processing fees, you will get an estimate of your equated monthly instalment (EMI). You will also get other crucial details such as the total interest payable and a detailed amortisation table breaking down your EMIs into principal and interest amounts on a monthly and yearly basis.

Most lenders allow you to make part prepayments on your loan every year. If you wish to make such payments, you can enter the details in the calculator and the result will tell you how much you will save on interest payments and by how many years your tenure will reduce.

List of Courses that are Covered under an Education loan

  • Nursery to class 12.
  • Graduation and Post-Graduation courses (technical/professional/diploma) conducted by approved universities or colleges under UGC/IMC/AICTE/government.
  • Regular degree/diploma courses administered by autonomous institutions such as IIM/IIT, etc.
  • Regular degree or diploma courses such as pilot training, aeronautical, shipping, and more approved by the Director General of Civil Aviation/Shipping/other regulatory authority.
  • Job oriented courses (professional/technical) for Graduation/Post Graduation/Diploma such as MBA/MCA/MS offered by reputed educational institutions, courses conducted by the Chartered Institute of Management Accountants (CIMA) – London or Certified Public Accountant (CPA) – USA.
  • Loans for skill development.
Abroad
  • Job oriented courses (professional/technical) for Graduation/Post Graduation/Diploma such as MBA/MCA/MS, etc. offered by reputable institutions.
  • Courses conducted by CIMA and CPA.

List of Expenses Covered in Education Loan

Here’s what the loan amount will cover:

  • Tuition fees
  • Hostel fees
  • Travel expenses passage money for students studying abroad
  • Insurance premium
  • Cost of books/equipment/instruments/uniform
  • Examination/laboratory/library fees
  • Cost of a computer/laptop required for course completion
  • Caution deposit, building fund/refundable deposit supported by institution bills/receipts
  • Any other expense required to complete the course such as study tours/thesis/project work

Features & Benefits of Study Loan

  • Loan financing up to Rs.1 crore available.
  • Loan repayment tenure up to 15 years.
  • Get Education loans for studies in India and abroad.
  • Some lenders offer loan disbursal before applying for a Visa.
  • Door-step service to collect required documents.
  • Children of the bank’s employees enjoy preferential rates at several banks.
  • Certain banks offer concessional interest rates to female students.
  • Enjoy a moratorium period of up to 1 year after course completion. During this period, you do not have to make payments on the loan.
  • Enjoy tax benefits up to 8 years on the interest paid.

Tax Benefits on Education Loan

You will get tax deduction on the interest paid on your education loan under Section 80E of the Income Tax Act, 1961. This benefit is only offered to individual borrowers and for the purpose of higher education. The deduction covers all fields of study in India and overseas. It also includes vocational as well as regular courses.

Please note that the tax deduction is only applicable on the interest portion of the EMI and not the principal. However, there is no maximum limit to claim this benefit. You will require a certificate from your bank or financial institution segregating the principle and interest portions of your EMIs to claim this benefit.

You can claim this benefit for 8 years from the year you started repayment or until the interest portion of your loan has been repaid, whichever occurs first.

List of Documents Required for Education Loan

Here is an indicative list of documents that most lenders ask:

  • Admission letter from the educational institution
  • Marksheets (previous education – school/college)
  • Age proof
  • ID proof
  • Address proof
  • Signature proof
  • Salary slips
  • Recent bank account statements
  • ITR with income computation
  • Audited balance sheet
  • Recent bank statements
  • Proof of turnover (service tax return/sales receipt)
  • Completed application form with signature
  • Latest passport size photographs
  • Appropriate Visa for studies abroad

*Document charges may be levied by the lender.

How to Apply Education Loan

There are several ways of applying for a student loan:

Apply Online:
  • This is the easiest and the most convenient way of applying. There are two ways of applying online. The first is a straightforward application form that you will fill online, attach the necessary documents, and submit the form.
  • The second is where you apply through providing all the requested details and the lender will then get in touch with you to discuss the terms of the loan before proceeding with the application.
Offline
  • Visit a Branch: You can apply for a loan by visiting your nearest branch with the necessary documents, discuss the terms of the loan with a representative, fill the form, and apply in person.
  • Call the Lender: You can either call the lender or request a call back by expressing your interest. You can then discuss the loan terms and proceed to apply.
Virtual Assistant
  • Banks and other financial institutions are now adopting digital methods to better serve their customers. One such method is using a Virtual Assistant to clear your doubts and request assistance with the application procedure.

Education Loan Repayment Process

The loan repayment period usually starts 6-12 months after completing your course or when you get a job, whichever occurs first. Different lenders provide different moratorium periods to applicants to repay the loan. You will have to repay your loan through EMIs.

Here are the different modes of repayments usually available:

  • Internet Banking - Pay online through the lender’s website or mobile app.
  • Cheque – Drop a cheque at any of the branches.
  • Direct debit – Set up recurring payments for your EMI to be directly debited from your bank account on the payment due date.
  • Demand Draft – Pay through a DD.

The preferred method of repayment varies between lenders. Therefore, it is advisable to check with your lender when taking the loan.

Discussed below are a few important details in regard to education loan repayment process:

Moratorium period: In the case of education loans, the beneficiaries will be able to start paying off the loan after the completion of the educational course or after successful employment.

Part-payment of education loans: The beneficiaries of education loans will be allowed to make part payments towards their loans. As an applicant, you can pay back a lump sum amount to make part repayment of the loan.

Pre-payment of education loan: If an applicant is able to manage the funds for the pre-payment of the loan amount, he or she will be able to do the same. However, it should be kept in mind that this might invite a processing fee.

If money is the only obstacle in your way from achieving your professional goals, then consider taking an education or student loan to fulfil your goals. You can get collateral-free goals wherein you need not provide any security to the lender and your repayments will not start immediately after graduation.

FAQ’s

  1. Is the RBI moratorium on loans due to the Covid-19 pandemic applicable for education loans too?
  2. Yes, the Reserve Bank of India’s moratorium on retail loans, due to people undergoing financial challenges due to the Covid-19 pandemic, is applicable to education loans as well. The moratorium on Equated Monthly Instalments (EMIs) could be availed from March 2020 to August 2020.

  3. Will I get the same amount of money on my education loan for the same level course in India and abroad?
  4. No, usually education loans for courses in India do not offer the same amount as for comparable level courses abroad. Education loans offer higher amounts for courses abroad as fees and other expenses may be higher there than for courses in India (which also depends on the educational institution).

  5. Is it possible to get an education loan without offering a collateral?
  6. Almost all education loans from banks and other lenders require a collateral which can be fixed deposits, property, shares, bonds, etc. However, you can still avail an education loan without having to give any collateral. This can be achieved through the Credit Guarantee Fund for Education Loan (CGFEL) Schemes which covers a collateral-free loan of up to Rs.7.5 lakh. This is only for education loans dispersed under the Model Education Loan Scheme of Indian Banks’ Association (IBA). To avail this, you have to apply for an education loan under this scheme through a scheduled commercial bank. You don’t need to provide security or collateral for amounts of up to Rs.7.5 lakh but anything above that will require a collateral.

  7. Can I take an education loan against mine or my parents’ fixed deposit?
  8. You can always avail a loan against a fixed deposit, as per the terms and conditions of the lender. However, there are certain banks, such as ICICI, which provide specifically education loan against fixed deposit.

  9. For courses abroad, is the loan offered in the currency of that particular country?
  10. For courses abroad, education loans are typically paid directly to the educational institution in the local currency of that country.

  11. Will the moratorium on education loan get extended if I choose to take a sabbatical from my course?
  12. The moratorium period on education loans differ from lender to lender. However, it is usually until the borrower gets employed or for up to 1 year of the course being completed, whichever is earlier. If you choose to take a sabbatical and want an extension of your moratorium, it would depend on the bank whether to grant it or not, so it is best to have a discussion about this with the lender.

  13. Are NRIs eligible for education loans from banks in India?
  14. One of the eligibility criteria for education loans that are offered by banks and other financial institutions in India is that the individual should be an Indian national. This means that any student who is a citizen of India can apply for and avail an education loan from a lender in the country. Collateral or documents which can be taken as security should be those that are enforceable in India.

  15. What do the lenders consider to approve the loan?
  16. Lenders consider the following factors when approving a loan:

    • The course and institute you choose
    • The amount you need
    • Your academic performance
    • Repayment capacity of your family
    • Family assets
    • Annual income
  17. What happens if I discontinue the course and get an employment within the grace period?
  18. In case you choose to discontinue the course mid-way, you must start repaying the loan immediately after getting a job.

  19. Can I port my education loan to another bank with lower interest rates?
  20. 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.

  21. Do all education loans cover 100% of the education expenses?
  22. 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.

  23. What are the other expenses covered by education loans?
  24. Some of the additional expenses covered by education loans are:

    • Hostel fees
    • Exam fees, laboratory and library fees
    • Cost of books, uniforms, projects, etc.
    • Travel expenses for overseas education
    • Deposits required by the educational institute

NEWS on Education Loan

  • DUET admit cards to be available soon

    The DU entrance exams also known as DUET for the year 2021 which is conducted by the Delhi University will be held soon for several UG, PG and MPhil and PhD courses from 26 September to 1 October. The candidates who will be appearing for the entrance exam will now soon be able to download their admit cards for the same.

    The candidates will be required to carry the self-declaration letter downloaded from the NTA website along with the call letter, transparent ballpoint pen, passport size photo, personal hand sanitiser, transparent water bottle and ID proof on the day of the exam.

    The candidate in order to download the admit card will have to click on the link nta.ac.in/duetexam, where on clicking the DUET Hall Ticket link they will be taken to a different page where the login credentials are to be entered. Once the candidate has logged in, click on Download DUET 2021 Admit Card. Once the admit card is downloaded, get a print out of the same and keep it safely for future reference.

    20 September 2021

  • Results declared for AP POLYCET 2021

    On 15 September 2021, the State Board of Technical Education (SBTET) announced the results of the Andhra Pradesh Polytechnic Common Entrance Test (AP POLYCET). Individuals who have given the test can check their results by visiting polycetap.nic.in. In order to download the result, you will need to visit polycetap.nic.in and click on ‘Result & OMR’. Next, you will need to click on the download link. Next, you will need to enter the TS POLYCET – 2021 hall ticket number. On the next page, you will be able to download and print the result.

    16 September 2021

  • NTA to release AIEEA PG admit card today

    The admit card for Indian Council of Agricultural Research, ICAR 2021 released on 7 September 2021 by National Testing Agency, NTA. This admit card will be downloaded by candidates who will appear for the All-India Entrance Examination for Admissions, AIEEA PG exam 2021. Candidates can find further details on the official site – icar.nta.ac.in.

    As per the previous notices, the exam will be held on 17 September, 2021. It is mandatory for the candidates to carry their ICAR Admit Card 2021 to the exam hall.

    The candidate can download the admit card by visiting the website icar.nta.ac.in, where on the Homepage, they will have to click on the link, ‘'ICAR Admit Card (AIEEA PG 2021).' A new page will open where the candidate will have to provide their necessary details, followed by entering the application number and password/date of birth. Once all the details have been entered, click on ‘Login’. The admit card will be displayed on your screen.

    You can then download a copy of it and take a print out of the same for future references.

    8 September 2021

  • NTA ICAR AIEEA Admit Card for 2021 has been Released

    On its official website, the National Testing Agency (NTA) released the admit card for the ICAR All India Entrance Examination for Admission to UG Courses (AIEEA-UG)-2021 on Thursday, 3 September 2021. The ICAR AIEEA UG admit card 2021 may now be downloaded from the official website – icar.nta.ac.in. On 7,8, and 9 September 2021, the National Testing Agency will hold the entrance exam.

    6 September 2021

  • CUCET 2021 application updates

    The application deadline date for CUCET 2021 exam conducted by NTA has been extended till 11:50 pm, 5 September. Students can pay fees till 11:50 pm, 6 September. The exam will be held on 15, 16, and 24 September in CBT mode, comprising multiple-choice questions. The exam duration is 120 minutes. Upon student's request, the government has allotted two additional exam centres at Kasaragod (Kerala) and Port Blair (Andaman and Nicobar). However, NTA has said in its official statement that a different city will be allotted based on the correspondence address in case fewer candidates choose a test centre. NTA will take the final decision regarding centre allotment.

    2 September 2021

  • OJEE admit card 2021 released

    The Odisha Joint Entrance Examination (OJEE 2021) admit card has been released and can be downloaded by visiting the website ojee.nic.in. On the website click on ‘ download admit card’ link and enter either your date of birth or application number following which the admit card will be displayed on the screen. Download the admit card and take its print out. The exam will be held from 6 September to 18 September.

    The entrance examination will be computer-based test (CBT) for all the courses, and will be conducted in three shifts on each day of the examination.

    2 September 2021

  • Latest updates for NTA NEET 2021 entrance exam date, admit card, guidelines, OMR answer sheet, exam centre list

    The National Testing Agency (NTA) announced the date for releasing of the admit cards for National Eligibility Entrance Test (NEET) 2021 entrance exam on 9 September. Once the admit card is released, it can be download from the NTA's official website- neet.nta.nic.in. The NEET 2021 entrance examination has been scheduled to take place on 12 September.

    Applicants can visit the NTA’s official website to check the exact location of their NEET 2021 entrance exam centre.The NEET 2021 entrance exam admit cards will have all the detailed guidelines on entry at the exam centre and the dress code too. The admit card will also have the guidelines to be followed in order to restrict the spread of COVID-19.The NTA has also released a list of instructions on how one can fill the OMR sheet along with a sample OMR sheet on its official website to help the candidates get clear demonstration.

    25 August 2021

  • NTA Begins Registration for CUCET 2021

    The Central Universities – Common Entrance Test (CUCET) 2021 will be held on 15, 16, 23, and 24 September 2021 by the National Testing Agency. The registration procedure for the same began on Monday, 16 August 2021 on the official website. Candidates seeking admission to the 12 Central Universities Integrated/Under-Graduate (UI) and Post-Graduate (PG) programmes for the academic year 2021-22 can apply for the CUCET through its official website, cucet.nta.nic.in. Candidates have till 1 September 2021 to submit their CUCET application form. The deadline for paying the application fee is 2 September 2021.

    18 August 2021

  • NEET 2021 will be conducted on 12 September 2021

    NEET 2021 will be conducted on 12 September 2021. The medical entrance exam will be held at the national level and will have syllabus that has been based on the state syllabi as well as the CBSE, COBSE, and NCERT syllabi. The test will have questions from the class 11 and class 12 syllabi from subjects such as biology, chemistry, and physics. The complete syllabus can be accessed at the official website of NEET.

    18 August 2021

  • All India AYUSH Postgraduate Entrance Test (AIAPGET) to be conducted on 18 September 2021

    Exam dates for the All India AYUSH Postgraduate Entrance Test (AIAPGET) has been announced by the National Testing Agency (NTA) for admission to AYUSH postgraduate courses. The examination will be conducted on 18 September, 2021. The application form is now available on the official website and can be filled in by eligible candidates till 21 August, 2021 by 5 pm. The exam will be conducted in two shifts, from 10 am to 12 noon and again from 3 pm to 5 pm. The application fee for the general and OBC-NCL category is Rs 2,700, for the general-EWS category is Rs 2,450, and for the SC/ST/PwD and transgender candidates, it is Rs 1,800.

    11 August 2021

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