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Best Education Loans in India 2022

Updated on June 23, 2022 , 11091 views

In this contemporary world, education is one of the most powerful weapons. Many students are not able to pursue proper education due to lack of financial support. That is why, in recent times, students who want to pursue higher education, especially from abroad universities, can opt for a loan.

education loan

For higher studies, you can get a plan for full-time as well as part-time courses and loans for working professionals.

Education Loan by Government and Private Banks

There are many private as well as government banks Offering student loans so that they can easily pursue higher education.

Top Private Banks for Education Loan

Bank Name Interest Rate Finance Processing Fees
ICICI Bank Starting @ 11.25% p.a Up to Rs. 50 lakh for domestic courses Up to Rs 1 crore for international courses 1% of the loan amount + GST
Axis Bank 13.70 % to 15.20% p.a Up to Rs. 75 lakh Nil to Rs. 15000+ tax
HDFC Bank 9.55% to 13.25% p.a Rs. 20 lakh Up to 1.5% of loan amount + tax
Tata Capital 10.99% onwards Up to Rs. 30 lakh Up to 2.75% of loan amount + tax

Loans from Government Banks for Higher Studies

Here’s a list of Government lenders offering education loan-

Bank Name Interest Rate Finance Repayment Period
Allahabad Bank Base Rate + 1.50% (0.50% concession for girls) Minimum 50,000 Loan up to 50,000 – up to 3 years, Loan above 50,000 and up to 1 lakh – upto 5 years, Loan above 1 lakh – up to 7 years
Andhra Bank Up to 7.50 lakh- Base Rate + 2.75%, Above 7.50 lakhs - Base Rate + 1.50% (0.50% concession for girls) Minimum Rs. 20,000, Maximum Rs. 20 Lakhs Loan up to 50,000 – up to 2 years, Loan above 50,000 and up to 1 lakh – 2 years to 5 years, Loan above 1 lakh – 3 years to 7 years
Bank of Baroda Above Rs. 4 lakh- Base Rate + 2.50%. Above 7.50 lakhs - Base Rate + 1.75% (0.50% concession for girls) Minimum Rs. 20,000, Maximum Rs. 20 Lakhs 120 maximum instalments for loan amount up to Rs 7.50 lakhs, 180 maximum instalments for loan amount above Rs 7.50 lakhs
Bank of Maharashtra Up to Rs. 4 lakh- Base Rate + 2.50%. Above Rs. 4 lakhs & up to Rs. 7.50 - Base Rate + 2%, Above Rs. 7.50 lakhs - Base Rate + 1.25% (0.50% concession for girls) In India: Max Rs. 10 Lakhs. In Abroad: Max Rs. 20 lakhs 5 years
Bank of India Upto Rs. 7.50 lakh- Base Rate + 3%, Above 7.50 lakhs - Base Rate + 2.50%. (0.50% concession for girls) In India: Max Rs. 10 Lakhs. In Abroad: Max Rs. 20 lakhs Up to Rs.7.50 lacs: 10 years, Above Rs.7.50 lacs: 15 years
SBI Bank Upto Rs. 4 lakh- Base Rate + 2%. Above Rs. 4 lakhs & upto Rs. 7.50 - Base Rate + 2%. Above Rs. 7.50 lakhs - Base Rate + 1.70% (0.50% concession for girls) Maximum Rs. 30 Lakhs Up to 15 years
State Bank of Hyderabad Up to Rs. 4.00 Lakhs – 11.50%, Above Rs. 4.00 Lakhs - up to Rs.10.00 Lakhs – 12.50% In India: Max Rs. 10 Lakhs. In Abroad: Max Rs. 20 lakhs NA
Punjab and Sind Bank Upto Rs. 4 lakh- Base Rate + 3%. Above Rs. 4 lakhs & upto Rs. 7.50 - Base Rate + 3.25%, Above Rs. 7.50 lakhs - Base Rate + 2.50%. (0.50% concession for girls) In India: Min Rs. 20,000,. In India: Max Rs. 10 Lakhs, In Abroad: Max Rs. 20 lakhs Minimum 2 years to 15 years(Depends upon loan amount availed)
Syndicate Bank Upto Rs. 4 lakh- Base Rate + 2.25%, Above Rs. 4 lakhs - Base Rate + 2.75% In India: Max Rs. 10 Lakhs, In Abroad: Max Rs. 20 lakhs Up to Rs.7.50 lacs: up to 10 years. Above Rs.7.50 lacs: up to 15 years
PNB Bank Upto Rs. 4 lakh- Base Rate + 2%. Above Rs. 4 lakhs & upto Rs. 7.50 - Base Rate + 3%, Above Rs. 7.50 lakhs - Base Rate + 2.50% (0.50% concession for girls) In India: Max Rs. 10 Lakhs. In Abroad: Max Rs. 20 lakhs Up to 15 years

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Eligibility

To get approval for the education loan, you need to meet the eligibility criteria, which are as follows:

Nationality

  • Indian citizen
  • Non-Indian Resident (NRI)
  • Overseas Citizens of India (OCI)
  • Persons of Indian Origin (PIOs)
  • Students born to Indian parents in foreign countries wish to study in India

Institutes

  • Recognized institutions and government colleges
  • Private institutes helped by government
  • Professional institutions
  • International colleges and universities

Courses

  • Undergraduate programs
  • Postgraduate programs
  • Doctoral courses and PhDs
  • Certificate courses with 6 months or longer duration
  • Technical/diploma/professional courses

Expenses Covered in Education loan

There are many benefits which are covered under the education loan. Some of the expenses covered are as follows:

  • Tuition Fees
  • Hostel fees
  • Travel expenses for students studying in abroad
  • insurance premium
  • Cost of books, uniform, equipment
  • Examination, laboratory, library fees
  • Cost of a computer, laptop required for course completion
  • Caution deposit, building fund, institution bills
  • Any other expense required to complete the course such as study tour, project work etc

Documents for Loan Approval

  • Admission letter from the educational institution
  • Marksheets (previous education – school/college)
  • Age proof
  • ID proof
  • Address proof
  • Signature proof
  • Salary slips
  • Recent bank account statements
  • ITR with the Income calculation
  • Audited Balance Sheet
  • Recent bank statements
  • Proof of turnover
  • Completed application form with signature
  • Latest passport size photographs
  • Appropriate Visa for studies abroad
  • Document charges can be imposed by the lender.

Tax Benefits on Education Loan

You can gain tax benefits on the interest paid on the education loan under Section 80E of the income tax Act, 1961. The tax benefit is only offered to individual borrowers with the purpose of higher education. The tax Deduction covers both India and overseas studies. Also, it is applicable for regular courses.

The tax deduction is available for the interest portion of the EMI and not the principal amount. Although, there is no maximum limit to claim the benefit. To avail tax benefits on education loan, you will have to provide a certificate from your bank or financial institution separating the principal and interest portions of the EMIs to claim the benefit.

Tax deduction for education loan can be availed only for 8 years. You cannot claim for deductions beyond 8 years.

How to Apply for Student Loan?

There are two ways for applying for student loan online and offline-

Online

Online is the most convenient way of applying for an education loan. Fill the form online on your lender’s website and attach the necessary documents and submit the form. The bank representative will get in touch with you for further process.

Offline

Visit a branch and apply for a loan with the necessary documents, fill the form and apply for a loan.

Education Loan Repayment

The loan repayment begins when your course is completed and also once you get a job. Every lender has a different moratorium period to repay the loan.

Also, there are various ways of repaying the loan such as-

Internet Banking- You can pay the EMI via this mode. You need to login to the official site of your bank and make the payments on the due date.

Cheque- You can drop the monthly EMI cheque at the bank branch.

Debit Card- Set up repeatedly payments for EMI to be directly debited from your bank account.

Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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