Educational Loans from Banks

August 14th, 2007

The following is copied from the UGC page on educational loans.

Government of India in consultation with Reserve Bank of India (RBI) and Indian Banker’s Association (IBA) has framed a Comprehensive Educational Loan Scheme to ensure that no deserving student in the Country is deprived of higher education for want of finances. The new scheme covers all type of courses including professional courses in schools and colleges in India and abroad.

The Salient features of the scheme are as under:

 

  • The scheme envisages loans up to Rs.7.5 lakh for studies in India and up to Rs. 15 lakh for studies abroad.

  • For loans up to Rs. 4 lakh no collateral or margin is required and the interest rate is not to exceed the Prime Lending Rates (PLR). For loans above Rs. 4 lakh the interest rate will not exceed PLR plus 1 percent.

  • The loans are to be repaid over a period of 5 to 7 years with provision of grace period of one year after completion of studies

Tax Benefit

Repayment of an education loan is deductible under section 80E of the Income Tax Act. The yearly limit for deduction is Rs. 40,000 (for both the principal and the interest). Only loans taken for higher education – fulltime studies in any graduate or post-graduate, professional, and pure and applied science courses – may claim deduction. The deduction will be available for a maximum of eight years starting from the day you start repaying.

Equitable Access to quality higher education has been a concern of the University Grants Commission. To this purpose the Commission, besides encouraging colleges and universities to provide for liberal financial support to the meritorious but needy students, has also been instrumental in educational loan scheme. The Reserve Bank of India (RBI) has issued guidelines in this regard to all commercial banks. A large number of banks have already launched educational loan schemes. Provided below are links to the respective website of individual banks offering such facilities.

Disclaimer: Since the rules, regulations, eligibility conditions, repayments and interests rates etc are revised by the banks from time to time in keeping pace with the changing capital market conditions, students and parents are advised to thoroughly check the terms and conditions of educational loan scheme on offer at the time of application.

Entry Filed under: Educational Loans

9 Writeup

  • 1. satyamahesh  |  January 19th, 2010 at 12:56 am

    I need education loan 323000 . my mobile no.9594781898

  • 2. Deboleena  |  March 17th, 2010 at 1:32 pm

    I have taken an education loan from SBI for pursuing my PGDM degree in 2008.So,I paid the college fees and the hostel fees of 2 years together in the 1st year itself.
    After 1 year suddenly our institute has increased the hostel fees and they are asking me for the balance.So what is the procedure to be followed by a student in such a situation.

  • 3. Farhan Quamar  |  June 5th, 2010 at 11:27 am

    i want to apply educational loan for MBA quickly

  • 4. rahul  |  August 1st, 2010 at 7:53 pm

    Hello sir,

    i ve taken a loan of 1,80,000 in 2005 , now my repayment starts , manager ve deducted 10,000 without informing as the manager doesnt i ve respect to talk to us so i feeling ashamed to talk to him he speaks as if we r beggars n cant repay so wat should i do n how much i ve to pay monthly according to the rbi rules plz help me out…….. i have not seen manager so cheap….loan i ve taken in corporation bank

    thanks n regards
    rahul

  • 5. rahul  |  August 1st, 2010 at 8:15 pm

    THE above statement is written by me

    the loan i ve taken from corporation bank,coen road ,hubli n he is a present manager…….i request u to take some actions n make him to go according to the rules which i ve read in RBI RULES FOR EDUCATION LOAN..

    thanks n regards

    RAHUL

  • 6. Ram More  |  August 7th, 2010 at 11:43 pm

    i want to apply educational loan for interier design diploma professional

  • 7. Amit kumar sharma  |  October 10th, 2010 at 8:50 pm

    i want to ask you. I wiill come under free interest rate scheme according to HRD. Please half me in detail . I had taken Rs 1 lakh loan in july 2010., at Union Bank Of India.

  • 8. BEERESH PUJAR  |  October 19th, 2010 at 2:38 pm

    i asked indian bank , the r not ready to sation edu loan, what to do..

  • 9. dr.dk  |  December 4th, 2010 at 8:27 pm

    I had approached a SBI bank and they ensured to give the loan after joining a course and later they denied to accept the loan application. Bank are not following the procedure..and am serious about this isuue..and I am going to ask that bank through RTI…and hope i will come up with a conclusion.

    If any one have faced such situation plz do write here..all type of suggestions are welcomed! plz do write.


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