• Loans for Private Schools

    Lenders offer loans to trusts and societies of private schools to expand their infrastructure. The interest rates are around 16% and vary between lenders. Interested candidates can get loans up to Rs.20 crore and repay it over a tenure of 10 years, provided they prove a steady cash flow for the future.

    Read further to learn the details of some of the lenders that provide loans for private schools.

    Compare Best Loans for Private Schools in 2019

    The table below compares the key features of lenders that offer Loans for Private schools:

    Bank Name Interest Rate Loan Amount Loan Tenure
    Reliance Money As per lender’s discretion Rs.25 lakh to Rs.20 crore 3 years to 10 years
    ISFC As per lender’s discretion Up to Rs. 2 crore Up to 7 years

    Reliance Money

    Reliance Money offers Loans for Private Schools to eligible candidates determined based on future cash flows. The loan is structured as per the understanding of the education funding business. The EMI installments are structured and can be paid on the 1st, 5th or 10th of the month.

    Key Highlights of Reliance Money’s Loan for Private Schools

    • The loan is processed within 8 days after requested documents are submitted.
    • Structured EMI instalments.
    • The loan can be repaid through National Automatic Clearing House (NACH), Electronic Clearing System (ECS), or Post-Dated Cheques (PDCs).
    Bank Name Processing Fee Part Payment Charges Preclosure?Charges
    Reliance Money 1% 5% As per lender’s discretion

    *Note: Charges mentioned above may vary based on applicable taxes.

    Internal Charges

    • Overdue interest: 2% per month
    • Cheque bounce charges: Rs.450
    • Loan cancellation: Rs.2,000


    ISFC is a lender that offers loans exclusively to the education sector. Candidates who have a good track record for existing loans and have a monthly fee of at least Rs.400 per student can apply for the loan. The loan can be utilised for an array of purposes such as the construction of a building, renovation, purchase of furniture, purchase of hardware or software, etc.

    Key Highlights of ISFC’s Loan for Private Schools

    • The lender offers secured loans up to Rs.2 crore and unsecured loans up to Rs.15 lakh.
    • A wide range of collaterals is accepted for this role. Up to 80% of the collateral is offered as the Loan to Value (LTV).
    • Loans can be repaid through NEFT or RTGS.
    Bank Name Processing Fee Part Payment Charges Preclosure?Charges
    ISFC As per lender’s discretion As per lender’s discretion Nil, up to 25% of the loan amount

    *Note: Charges mentioned above may vary based on applicable taxes.

    Internal charges

    Contact ISFC to know more about the internal charges and penalties levied on the loan.


    • The business should have sustained for a minimum period as required by the lender.
    • Tax returns need to have been filed for the school.
    • Societies, public limited companies, private limited companies, trusts, etc. running recognised, unaided educational institutions can apply.
    • In most cases, the existing school building is mortgaged for the loan.

    Documents Required

    • Application form
    • KYC documents
    • Bank statements
    • PAN card of the applicants as well as the society/trust
    • Copy of affiliation certificates of the school
    • Copy of registration certificate of the society/trust
    • Copy of other society/trust-related documents such as the updated list of members, by-laws, and so on

    Things to consider while getting a loan for a Private School

    Many lenders in the Indian market offer loans to schools so that they can expand and provide better opportunities to students. Each lender has a set of eligibility criteria and guidelines concerning the maximum loan amount and how the loan can be repaid. Make sure you familiarise yourself with the process and keep the necessary documents in handy when you apply for the loan.

    How to Apply for a Loan for Private Schools?

    You can visit the nearest branch office of the lender you plan to get the loan from and enquire about the application process. You will have to collect the application form, fill it up, and submit it to the lender. Once the lender verifies the documents, it will approve or reject the application. If approved, the loan amount is disbursed within a few days.

    Alternatively, you can go to the official website of the lender and provide your details so that the executives can call back and direct the application process to you.

    Loans for Private Schools FAQs

    1. Are guarantors required for the loan?

      Ans: Typically, co-applicants are required for the loan. Some lenders may need all owners of the property to act as co-borrowers. Otherwise, the loan can be applied through the society/trust of the school.

    2. Are these loan options available only for schools?

      Ans: Most lenders offer loans to varied educational institutions from schools to colleges offering degree courses.

    3. Can I transfer our existing loan liabilities?

      Ans: Yes, certain lenders such as ISFC allow candidates to transfer existing liabilities.

    4. How is the rate of interest calculated?

      Ans: The rate of interest offered to the loan applicants depends on an array of factors such as the future cash inflow of the school, loan repayment history, loan amount requested, loan tenure chosen, and so on.

    5. Will I have to pay any extra fees during the tenure of the loan?

      Ans: Charges such as processing fees and documentation fees are charged when the loan is processed. Other charges and penalties such as overdue EMI, cheque bounce, change in EMI cycle, cheque swap, etc. may be payable depending on the instance.

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