Reserve Bank of India (RBI) & Indian Banker's Association (IBA) associates Education loan scheme

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

Andhra Bank
Educational Loan Scheme

Bank of Baroda
BOB Scholar

Bank of India
Vidya Vardhini

Bank of Maharashtra
Educational Loan

Canara Bank
Vidyasagar Loan

Central Bank of India
Centvidhyarathi

Corporation Bank
Educational Loan Scheme

Dena Bank
Dena Vidya Laxmi

Indian Bank
Educational Loan Scheme

Indian Overseas Bank
Vidya Jothi

Oriental bank of Commerce
Educational Loan Scheme

Panjab and Sindh Bank
Educational Loan Scheme

Panjab National Bank
Vidyalaksyapurti

State Bank of India
Educational Loan Scheme

State Bank of Bikaner and Jaipur
Educational Loan Scheme

State Bank of Hyderabad
Educational Loan Scheme

State Bank of Indore

State Bank of Mysore
Educational Loan Scheme

State Bank of Saurashatra
Educational Loan Scheme

State Bank of Travancore
Gyan Jyothi

Syndicate Bank
SyndVidya

UCO Bank
Educational loan Scheme

Union Bank of India
SyndVidya

United Bank of India
Educational loan Scheme

Vijaya Bank
Education Loan Scheme