Central Scheme of Interest Subsidy for Educational Loans
An initiative to help students from Economically Weaker Sections
One of the major concerns of the Government of India is to ensure that nobody is denied professional education because he or she is poor. Indian Banks' Association (IBA) has formulated a comprehensive model educational loan scheme for adoption by all Banks. In order to support students from Economically Weaker Sections of the Society, Department of Education, Ministry of Human Resource Development, Governemnt of India has launched this interest subsidy scheme.
1. Only for Educational Loans availed from Scheduled Banks for pursuing any of the approved courses after Class XII in Technical and Professional streams from recognized institutes in India under the Educational Loan Scheme of IBA.
2. Students belonging to Economically Weaker Sections with annual gross parental/family income from all sources with an upper limit ofRsA.50 lacs.Certificate to this effect issued by authorized officers of State Government is to be submitted.
3. Full interest subsidy is available for the period of moratorium i.e Course Period plus 1 year or 6 months after getting the job, whichever is earlier.
4. Scheme is applicable for the loan amount availed from April 01, 2009 to March31, 2010(Academic Year 2009-10).
5. For Loans sanctioned earlier to 1.04.2009, only amounts disbursed during the above period are eligible.
Education loan : Eligibility
Student should be an Indian National and should have secured admission to the relevant Professional/ Technical courses in India or Abroad through Entrance Test/ Merit Based Selection process. However there is no age restriction for the applicant.
(A) Studies in India ( Indicative List )
Graduation courses : BA, B.Com., B.Sc., etc.
Post Graduation courses : Masters & Phd.
Professional Courses :Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Computer courses (BCA / MCA / BSc-CS, etc)
Animation /Cartooning/ multimedia/Graphic Designing, etc. where the course period should be one year and above & the courses conducted by reputed Institutions and the Institute to fulfil any of the following criteria:
(i) NASSCOM rated/certified
(ii) AICTE affiliated
(iii) Accredited to any UGC affiliated university in India
(iv) Affiliated to reputed Foreign Universities
(B) Studies Abroad
(i) Graduation: For job oriented professional / technical courses offered by the reputed university.
(ii) Post graduation: MCA, MBA, MS, etc.
(iii) Courses conducted by CIMA-London, CPA in USA, etc.
(iv) Pilot Training Programme offered by recognized institutions abroad approved by competent authority in that country. Example in USA the Federal Aviation Administration, Government of USA.
The licences issued by such institutions should be convertible into corresponding Indian Licences in case the applicant desires to take up employment in India after completion of course/ training abroad, as per directives of Director General of Civil Aviation, Government of India.
Expenses Considered for Loan :
(i) Fee payable to college/ school/ hostel.
(ii) Examination/ Library/ Laboratory fee.
(iii) Purchase of books/ equipments/ instruments/ uniforms.
(iv) Caution deposit/ building fund/ refundable deposit supported by Institution bills/ receipts.
(v) Travel expenses/ passage money for studies abroad.
(vi) Purchase of computers – essential for completion of the course.
(vii) Any other expense required to complete the course – like study tours, project work, thesis etc.
(viii) Issuance of DD favouring CET Cell
(ix) Fee payable to the Institution/hostel/examination fee, cost of books, travel expenses for studies abroad, purchase of computer, etc.
Loan Amount :
(i) Studies in India : Maximum Rs.10.00 lakhs
(ii) Studies abroad : Maximum Rs.20.00 lakhs
Rate of Interest :
BPLR - 1.25 % p.a. Floating
Simple interest basis during study & repayment holiday period (upto one year after completion of the course or six months after securing a job, whichever is earlier)
Concession for Girl Students : Our Bank has extended a 0.50 % interest concession to Girl Students for loans availed on or after 01.11.2008 and will be effective till 31.12.2010. This interest concession will be extended till closure of the loan.
Note: 1% interest concession is provided for loanees if the interest is serviced during the study period.
There will be NO Pre-payment and NO Pre-Closure Charges
(i) Upto Rs. 4.00 Lakhs : NIL
(ii) Above Rs. 4.00 lakhs : Studies in India: 5%
: Studies Abroad:15%
Scholarship / Assistantship to be included in the margin. Margin can be brought in as and when disbursements are made on prorate basis
|Amount||Studies in india||Studies in abroad|
|Upto Rs. 4 lacs||No Security||No Security|
|Above Rs. 4 lacs to Rs. 7.50 lacs||Suitable Third Party Guarantee||Suitable Third Party Guarantee|
|Above Rs. 7.50 lacs to Rs. 10 lacs (India) / Rs. 15 lacs (Abroad)||Tangible Collateral security for full value of loan||Tangible Collateral security of suitable value of loan or third party guarantee with assignment of future income of the student for payment of instalments|
|Rs 15 lacs to Rs. 20 lacs||NA||Tangible Collateral security for full value of loan and third party guarantee with assignment of future income of the student for payment of instalment|
|Repayment will commence one year after completion of the course or 6 months after securing a job, whichever is earlier.|
|Place of Study||Loan Amount||Repayment Period in Years|
||Up to Rs. 7.50 lakh||5 - 7|
|Above Rs. 7.5 lakh||5-10
||Up to Rs. 15 lakh||5 - 7|
|Above Rs. 15 lakh||5-10|
|In respect of Pilot Training Programme, Loan is to be repaid within 5 years after commencement of repayment
Additional conditions applicable for online education loan applications
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