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The TamilNad Mercantile Bank, or TMB offers short term study loans to customers among various other products. The scheme is ideal for parents looking to fund higher education of their children in India or abroad. The fund aims to cover the cost of education of the future generations through low interest funds.
The loan amount can be used to secure admission in a school, college or university for school education, diploma, graduation and post-graduation courses. The following expenses can also be covered through the loan amount:
Students enrolled in the following programs can avail Short Term Study loan from TMB.
You can avail a maximum of Rs.25,000 or 3 months’ gross salary of the parent, whichever is lower.
TMB short term study loan is a low-cost loan. The rate of interest here is:
BR + 3.75% = 14.15% p.a. (Base Rate as of November 2015 is 10.40% p.a.)
You can apply for this loan by downloading and filling up the application form available online as well as at any of the branches of TMB.
Currently the bank doesn’t support online applications. However, you can download the application form online and fill and submit the same at any of the branches of TMB. You can also use the BankBazaar online loan application portal to apply for this and various other loans.
The full amount of student loan interest (not principal) repaid in a year can be claimed as deductions under Section 80E of the Income Tax Act, 1961. The applicant on whose name the loan is sanctioned can only benefit from the deduction.
Suppose you have been sanctioned a loan of Rs.25,000 under this scheme which has to be repaid in 12 monthly instalments at most. Your EMI calculations will be as follows: