Education Loan Interest Rates in India 2019 - 2020

Last Updated 14th Oct 2019

Education Loan for Courses in India, US, France and Australia

  • Anyone in the country who wants to get higher education in India and abroad can apply for Education Loan
  • Repayment of the Education Loan starts after the completion of the course for a tenure of 5 to 7 years
  • Minimum amount to get Educational Loan should be Rs. 50,000. No guarantor or collateral is required for loans below Rs. 4 lakh
  • Some banks offer discounts or lower interest rates for female students on Education Loan
Apply for Education Loan @ 8.40%* Get upto ₹ 200* Cashback

Education Loan Interest Rates comparison, Oct 2019, Best rates

Bank Education Loan Interest Rates in India Education Loan Interest Rates in Abroad
Avanse DHFL Education Loan 11.50% 11.50%
Axis Bank Education Loan 13.70% 13.70%
Bank of Baroda Education Loan 8.40% 9.15%
Bank of India 9.85% 9.85%
Bank of Maharashtra 10.25% 10.25%
Canara Bank 9.95% 9.95%
Central Bank of India 10.10% 10.00%
Corporation Bank 10.90% 10.90%
Federal Bank 10.85% 10.85%
IDBI Bank 9.50% 9.50%
Indian Bank 8.60% 10.60%
Indian Overseas Bank 10.65% 10.65%
Karnataka Bank 10.90% 10.90%
Karur Vysya Bank 11.35% 11.35%
OBC 10.40% 10.40%
PNB 8.45% 10.45%
SBI 8.85% 10.00%
UCO Bank 10.65% 10.65%
Union Bank of India 10.20% 10.20%
United Bank of India 10.50% 10.50%

Student Loan Interest Rates – Eligibility, FAQ's

Determinants of Eligibility for Education Loans

Age of the Applicant
  • Upto 35 years for non-employed personnels
  • Upto 45 years in case of working employees/ executives
Who is eligible
  • An Indian National having secured admission to professional/technical courses in recognized institutions
  • Students seeking admission for higher studies
  • Permanent employees who are employed for not less than three years with any organisation and who intend to acquire higher professional qualifications and have secured admissions in a reputed institute
Maximum Loan Amount
  • Typically upto Rs. 10 lakh for studies in India; with minimum margin money (own contribution by student/ family) of 5% of total cost
  • Typically upto Rs. 20 lakh for studies abroad, some banks offer upto Rs. 30 lakhs with minimum margin money (own contribution by student/ family) of 15% of total cost
  • Upto Rs. 30 lakh for studies at IIT's, IIM's and ISB's with minimum margin money (own contribution by student/ family) of 5% of total cost
Which Cost Heads/ Expenses are Funded by Bank
  • Admission fees including Monthly Fees and Examination Fees
  • Books, Stationery and Equipments
  • Airfare for joining the course abroad
  • Boarding & lodging expenses of authorized hostel or boarding house
  • Expenses required to complete the courses like those on study tours, project work and thesis etc.
Co-borrower/ Guarantor/ Security
  • Loans upto Rs 4 lakh: Parents or guardian or husband/in-laws in case of married woman required need to be co-borrower
  • Loans above Rs 4 lakh and upto Rs 7.5 lakh: Parents or guardian or husband/in-laws in case of married woman need to be co-borrower and a third party guarantee needed as collateral
  • Above Rs 7.5 lakh: Parents or guardian or husband/in-laws in case of married woman need to be co-borrower and tangible security equivalent to 100-133% of loan amount as collateral
Repayment Frequency
  • Quarterly or monthly rests
  • Repayment typically starts 1 year after completing the course or six months after getting a job, whichever is earlier
Repayment Period
  • Varies from bank to bank - can range from 7 to 15 years
  • There is no prepayment penalty or charge on early prepayment or foreclosure
Key Appraisal Criteria
  • Good academic record with atleast 50% marks in the qualifying examinations
  • Admission letter from bonafide educational institution
  • Passport/visa/i-20 form for studies abroad
  • Net-worth and credit history (CIBIL) of the guarantors

Tax benefit on Educational Loan

  • Interest paid on education loan can be claimed as deduction from income of borrower (student) as per Section 80E of the Income Tax Act, 1961
  • Rebate can be claimed without any upper ceiling or cap
  • Rebate is available for full time courses, part time courses and vocational courses pursued in India and abroad
  • Rebate can be claimed within eight (8) years post moratorium period subject to actual payment of interest
  • Rebate is available for interest paid on loans for education of self, spouse, children or for the student of whom he/she is the legal guardian
  • No rebate is available for principal repayment
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Education Loan News - Oct 2019
*Terms and conditions apply. Credit at sole discretion of lender subject to credit appraisal, eligibility check, rates, charges and terms. Information displayed is indicative and from collected from public sources. Read More