What is Education Loan?
An education loan is a type of financial aid that helps students cover the costs associated with pursuing higher education.
Types of Education Loans:
- Government-funded loans (e.g., Central Sector Interest Subsidy Scheme)
- Bank loans (e.g., SBI, HDFC, Axis)
- Private lender loans (e.g., NBFCs, online lenders)
- International student loans
Eligibility Criteria:
- Indian citizenship
- Admission to a recognized institution
- Age: 18-35 years
- Co-applicant (parent/guardian) required
- Academic performance (some lenders require a minimum percentage)
Loan Features:
- Loan amount: Up to ₹20 lakhs (varies by lender)
- Interest rates: 8.5%-15% per annum (floating/ fixed)
- Repayment tenure: Up to 15 years
- Moratorium period (course duration + 6-12 months)
- Processing fees: Up to 2%
- Collateral/ security: Required for larger loan amounts
Documents Required:
- ID proof (Aadhaar, PAN)
- Address proof
- Academic records (marksheets, certificates)
- Admission proof (letter, fee receipt)
- Income proof (co-applicant's)
- Bank statements
Tax Benefits:
- Interest deduction under Section 80E of the Income Tax Act
- Repayment benefits under Section 80C
Popular Education Loan Providers:
- State Bank of India (SBI)
- HDFC Bank
- Axis Bank
- ICICI Bank
- Canara Bank