Best Banks For Education Loan In India

Are looking for a banks for education loan, there Many big banks in India offer educational loans to people wanting to achieve their academic goals. These educational loans cover a wide range of expenses and are provided for education in India and abroad. Certain documents are required to go about it. This article discusses all the requirements, considerations and lists some of the best banks to opt for an educational loan. 

Educational Loan Features

  • Educational loans can finance costs up to 1 crore. 
  • Its repayment tenure can reach upto 15 years and is given for education both in India and abroad.
  • There are a few banks that give loans even before applying for a Visa. The facility of doorstep collection of documents is also available.
  • Certain banks give female concessions for educational loans. 
  • The banks give a moratorium period of one year to the student to search for jobs and start repaying the loan from the following year.
  •  Tax benefits are also available with educational loans. The tax deduction is available only on the interest portion of the EMI, not on the principal. A certificate will be issued by the bank stating the segregation of principal from the interest. This benefit is available for eight years from the time of repayment.

Expenses Covered by an Educational Loan

An educational endeavors to cover a wide range of expenses to pursue the education without caring about the expenses. An educational loan covers:

  • Tuition Fees
  • Hostel Fees
  • Travel Expenses
  • Insurance
  • Books, uniform, instruments and equipment 
  • Examination fee
  • Library membership fees
  • Computer or laptop required for the course
  • Caution money/ refundable fees deposited to the institution/ receipts
  • Other expenses like Study tours/thesis cost/ project work cost etc.

Eligibility for Applying for an Educational Loan in india

Nationality :

An Indian citizen can apply for educational loans. These Indians can be Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs), Persons of Indian Origin (PIOs) and students born to Indian parents abroad and wish to study in India.

Courses:

Educational loans cover a wide range of courses. They are available for undergraduate, postgraduate, Doctoral courses, PhDs, certificate courses, job-oriented courses, technical, diploma and professional courses. 

Institutions:

Government colleges, recognized institutions, private institutes funded by the government, institutes offering professional courses and international colleges and universities. 

Collateral:

Collateral-free for loans upto Rs. 7.5 lakhs and loans upto Rs. Forty lakhs for specific courses or institutions. Generally, residential or commercial property, plot, a fixed deposit or insurance is kept as acceptable collateral. 

Documents Required for an Educational Loan in india

Following is the list of documents required for an educational loan:

  • Admission letter from the university or the institute
  • Marksheets of the previous school or college
  • Age Proof
  • ID proof
  • Address proof
  • Signature proof
  • Salary Slips
  • Recent bank account statements
  • ITR with the income computation
  • Recent bank statement
  • Audited balance sheet
  • Proof of turnovers like service tax or sales receipt
  • Complete application with signature
  • Passport size photographs
  • Appropriate Visa for studies abroad

There are document charges that are levied from the lender.

How to Apply For an Educational Loan in India

There are majorly three ways to apply for an educational loan- Online, Offline, and virtual assistance.

1. Online Method – It is the most convenient method and can be done in two ways, first is simply by filling the online form and attaching the required documents with it. The second way is to provide all the necessary details and then allow the lender to get in touch to discuss the loan terms.

2. Offline Method- The educational loan can be applied by visiting the bank’s branch with the required documents. Discuss the loan terms with the lender, fill the form, attach the documents and apply for the loan. Or the borrower can call the lender and discuss the terms and proceed to apply for the loan. 

3. Virtual Assistant- This is a new method started by banks for their customers for their safety. The borrower can discuss the loan terms, clear their doubts, and then apply for the loan.

Best Banks For Education Loan In India

Educational Loan by Government Banks

Bank Name Processing FeeInterest RateAmount of LoanHow to Apply
Bank of IndiaNil for IndiaRs. 5000 + Taxes for abroad9.10% onwardsIndia – Rs.10 lakhsAbroad – Rs.20 lakhsApply Now
Indian BankNil9.45% to 12.50%Rs. 10 lakhsApply Now
Bank of Baroda1% of the loan amount upto Rs. 10,0008.25% to 10%Upto Rs.4 and aboveApply Now
Bank of MaharashtraNil7.20% to 9.05%India – Rs.10 lakhsAbroad – Rs.20 lakhsApply Now
Canara BankNil7.85% to 9.85%Rs 1 Lakh to Rs. 40 LakhsApply Now
Central Bank of IndiaNil9%8.50% – for girls India – Rs.10 lakhsAbroad – Rs.20 lakhsApply Now
Union Bank of IndiaNil for Indian Students0.50% +GST for NRI students6.90% onwardsNeed based financeApply Now
UCO BankNilAbove Rs. 4 lakhIndia – 5%Abroad – 15%India – Rs.10 lakhsAbroad – Rs.20 lakhsApply Now
SBIRs. 10,000 + Tax7.97% to 10.05% Above Rs. 20 lakhsApply Now
Punjab National Bank 1% of loan amount7.30% onwardsRs. 15 LakhsApply Now
Punjab and Sind BankNil8.30 % to 10.10% Upto 20 lakhsApply Now

Educational Loan by Private Banks

Bank NameProcessing FeeInterest RateAmount of loanHow to apply
AxisNil to Rs 15,000 + tax13.70% to 15.20%Upto Rs. 7.5 lakhsApply Now
HDFC1.5% of the loan amount + taxContact the bankMax AprApply Now
Tata Capital2.75% of the loan amount + tax10.99% onwardsUpto Rs. 30 lakhsApply Now
Kotak MahindraContact the bankUpto 16%India – Rs.10 lakhsAbroad – Rs.20 lakhsApply Now
ICICI BankContact the bankContact the bankIndia – Rs.50 lakhsAbroad – Rs.1 croreApply Now
Federal BankContact the bank10.05% onwardsIndia – Rs.10 lakhsAbroad – Rs.20 lakhsApply Now

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