Educational Loan

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.

• Allahabad Bank
  Educational Loan Scheme Application form
  
  

• Andhra Bank
  Educational Loan Scheme Application Form
  
  

• Bank of Baroda
  BOB Scholar Application form
  
  

• Bank of India
  Vidya Vardhini Application Form
  
  

• Bank of Maharashtra
  Educational Loan Scheme Application Form
  
  

• Canara Bank
  Vidyasagar Loan Application Form
  
  

• Central Bank of India
  Centvidhyarath Application Form
  
  

• Corporation Bank
  Educational Loan Scheme Application Form
  
  

• Dena Bank
  Dena Vidya Laxmi Application Form
  
  

• Indian Bank
  Educational Loan Scheme Application Form
  
  

• Indian Overseas Bank
  Vidya Jothi Application form
  
  

• Oriental bank of Commerce
  Educational Loan Scheme Application Form
  
  

• Panjab and Sindh Bank
  Educational Loan Scheme Application From
  
  

• Panjab National Bank
  Vidyalaksyapurti Application Form
  
  

• State Bank of India
  Educational Loan Scheme Application Form
  
  

• State Bank of Bikaner and Jaipur
  Educational Loan Scheme Application Form
  
  

• State Bank of Hyderabad
  Educational Loan Scheme Application form
  
  

• State Bank of Indore
  
  

• State Bank of Mysore
  
  

• State Bank of Saurashatra
  

• State Bank of Travancore
  Gyan Jyothi Application Form
  
  

• Syndicate Bank
  SyndVidya Application Form
  
  

• Uco Bank
  Educational loan Scheme Application form
  
  

• Union Bank of India
  
  

• United Bank of India
  Educational loan Scheme Application Form
  
  

• Vijaya Bank
  Education Loan Scheme Application Form

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.