Introduction
Education loans are extended to such students who dream of pursuing their higher studies in India or abroad. Students who have managed to secure a seat from a recognized university and have received their admission letter can apply for an education loan. Most students choose Government banks as it is considered as one of the best sources to fund your education with lower interest rates. They opt for Govt. education loan before turning up to any other financial institution. This article aims to explain Education Loan by Government banks in India, interest rates, repayment tenure, collateral requirement etc which will be very insightful for students who are looking to fund their education through Government banks.
Education Loan by Government- Education loan providers in India
1. State Bank of India
SBI is the 43rd largest bank in the world and has ranked 221st in the Fortune Global 500 list of the world’s biggest corporations of 2020. It is the only Indian bank on the Fortune Global 500 list.
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Headquarters |
State Bank Bhawan, M.C. Road, Nariman Point, Mumbai, Maharashtra, India |
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Interest rates |
8.80% for females 9.30% for males |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-10 years Loans above ₹ 7,50,000- In India and abroad- 12 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
2. Punjab National Bank
Punjab National Bank (PNB) was founded in 1894 and is the second largest public sector bank (PSB) in India. It has spread its wings both in terms of business and its network. It is dealing with almost 180 million customers.
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Headquarters |
Dwaraka, New Delhi, India |
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Interest rates |
Loans upto ₹ 7,50,000-10.90% for females 11.40 % for males Loans above ₹ 7,50,000- 10.65% for females 11.15 % for males |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-10 years Loans above ₹ 7,50,000- In India and abroad- 15 years |
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Collateral security |
For loans upto ₹ 4,00,000-In India and abroad- Collateral not required For loans upto ₹ 7,50,000- In India and abroad- Collateral required For loans above ₹ 7,50,000-In India and abroad-Collateral not required |
3. Bank of Baroda
Bank of Baroda (BOB) is one of the third largest Indian multinational, public sector in India dealing with almost 131 million customers and has a total business of US$218 billion. It is ranked 1145 on Forbes Global 2000 list, based on 2019 data.
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Headquarters |
Vadodara, Gujarat, India |
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Interest rates |
Prime Universities- 7.75% for Females |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 10% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-10 years Loans above ₹ 7,50,000- In India and abroad- 15 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
4. Canara Bank
Canara Bank was founded in 1906 and is one of the oldest and prominent public sector banks in India. It was named by the Canara Hindu Permanent Fund, but then later converted into Canara Bank Limited in 1910.
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Headquarters |
Bangalore, Karnataka, India |
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Interest rates |
Loans upto ₹ 7,50,000-8.90% Loans above ₹ 7,50,000- 8.50% |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 85% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-10 years Loans above ₹ 7,50,000- In India- 15 years; In abroad- 85 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
5. Union Bank of India
Union Bank of India (after merging with Corporation Bank and Andhra Bank) came into effect on 1st April 2020 and is one of the largest bank in terms of the branch network. It is one of the largest government owned banks of India dealing with almost 120+ million customers and has a total business of US$106 billion.
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Headquarters |
Mumbai, India |
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Interest rates |
Loans upto ₹ 4,00,000- In abroad- 8.55 % for males, 8.05% for females Loans ₹ 4,00,000 - ₹ 7,50,000 In abroad- 8.55 % for males, for - 8.05% for females Loans upto ₹ 7,50,000- In India- 8.90 % for males, 8.40% for females |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-10 years Loans above ₹ 7,50,000- In India- 15 years; In abroad- 15 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
6. Bank of India
Bank of India (BOI) was founded in 1906 is an Indian commercial bank and has been owned by Government since 1969. Bank of India included five subsidiaries, five representative offices, and one joint venture.
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Headquarters |
Bandra Kurla Complex, Mumbai, India |
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Interest rates |
Loans upto ₹ 7,50,000-9.05% (females and males) Loans above ₹ 7,50,000- 9.85% (females and males) |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-10 years Loans above ₹ 7,50,000- In India and abroad- 15 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
7. Indian Bank
Indian Bank was established in 1907 and is an Indian state-owned financial services. It is dealing with almost 100 million customers. It is one of the top-performing public sector banks in India.
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Headquarters |
Chennai, India |
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Interest rates |
Loans upto ₹ 7,50,000- In India and abroad- 7.15 % - 8.15% Loans above ₹ 7,50,000- In India and abroad- 7.15 % - 8.15% |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad- 7 years Loans above ₹ 7,50,000- In India and abroad- 7 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
8. Central Bank of India
Central Bank of India is one of the oldest and largest government-owned banks in India. It is one of the twelve public sectors in India to get recapitalized in 2009.
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Headquarters |
Mumbai, Maharashtra, India |
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Interest rates |
Loans upto ₹ 7,50,000-8.50% for females 9.00 % for males Loans above ₹ 7,50,000- In India, 8.50% for females 9.00 % for males, In Abroad, 9.00 % for females 9.00 % for males |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad- 10 years Loans above ₹ 7,50,000- In India and abroad- 15 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
9. Indian Overseas Bank
Indian Overseas Bank, abbreviated as IOB was founded in February 1937 and is one of the major public banks with almost 3,400+ domestic branches. It has fabricated various milestones in Indian Banking Sector and has been taken over by the Government. It was the first bank to venture into consumer credit by initiating a personal loan scheme.
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Headquarters |
Chennai, Tamil Nadu, India |
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Interest rates |
Loans upto ₹ 7,50,000-10.65% (females and males) Loans above ₹ 7,50,000- 11.65% (females and males) |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-7 years Loans above ₹ 7,50,000- In India and abroad- 7 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
10. UCO Bank
UCO Bank was established in 1943 and is one of the major government owned commercial banks of India. UCO Bank is ranked 1860 on the Forbes Global 2000, based on 2014 data. According to the Brand Trust, UCO Bank was ranked 294th among India’s most trusted brands.
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Headquarters |
Kolkata, West Bengal, India |
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Interest rates |
Loans upto ₹ 7,50,000-9.30% (females and males) Loans above ₹ 7,50,000- 9.70% (females and males) |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-10 years Loans above ₹ 7,50,000- In India and abroad-15 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
11. Bank of Maharashtra
Bank of Maharashtra is a major public sector bank in India and is dealing with almost 15 million customers across the country. Bank of Maharashtra has the largest network of branches in the state of Maharashtra. The Government of India holds 92.94% of the shares.
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Headquarters |
1501, Lokmangal, Shivajinagar,Pune India |
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Interest rates |
Loans upto ₹ 7,50,000-8.90% (females and males) Loans above ₹ 7,50,000- 8.55% (females and males) |
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Margin requirement |
Loans upto ₹ 4,00,000- In India and abroad- 0% Loans above ₹ 4,00,000- In India- 5%; In abroad- 15% |
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Maximum tenure |
Loans upto ₹ 7,50,000- In India and abroad-7 years Loans above ₹ 7,50,000- In India and abroad-7 years |
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Collateral security |
For loans upto ₹ 7,50,000-In India and abroad- Collateral not required For Loans above ₹ 7,50,000-In India and abroad-Collateral required |
Note: The above-mentioned interest rates are correct as of the date of publishing the article as they are subject to change with the change in the market factors.
Government banks are mostly known for the slow processing of loans and there have been several cases where applications of students have been rejected without even stating the main reason of rejection. Therefore, we recommend you to apply through VidyaLoans as our rapport with the concerned banks makes it possible to process your loan in 12 to 15 days. One of the biggest advantages of applying through VidyaLoans is that our team shares a professional affinity with sanctioning officers and manages to keep a close check on your loan application status.
Education Loan by Government: Attractive Factors
- Low interest rates
Students who opt for Govt education loans to fund their education, this would possibly be the best choice as the education loan interest rates offered by the Government banks are less as compared to other lenders in the market. They usually do not cross the bar of more than 10%. Therefore, Government student loans are affordable and student friendly in nature. - Education loan Subsidy
One of the biggest advantages of taking an education loan through Government banks is that students can avail the education loan subsidy benefits which is only applicable to the interest rates of Government banks education loans. To know more, read this article Education loan subsidy schemes in India to know more. - The Vidyalakshmi Education Loan Portal
TThe Vidyalakshmi education portal was designed by the Government of India under the Pradhan Mantri VidyaLakshmi Yojana where students can access the portal and apply for Government student loans. Through this student can access their status of loan application on the portal. But a few times, when students directly apply through Vidyalakshmi portal, students cannot edit the form once submitted. Therefore, it is suggested that students seek professional assistance through VidyaLoans to fill in their forms to avoid such a situation. - Student friendly education loan repayment terms
Government banks have the most student friendly education loan repayment policies. One of the major advantages is that students get a payment free moratorium period. This provision provides students adequate time to acquire a job and then start the repayment of the loan. Through Govt. education loans, students get the repayment tenure of 15 years to repay their loan amount. - Flexible Education Loan Eligibility Criteria
All the students are required to meet certain standards to be able to avail an education loan. Major advantage of processing through Government banks is that they allow a Third-party collateral with a decent income status as a financial co-applicant.
These are the few advantages of taking an education loan from the Government but students usually face trouble like slow loan process, delayed response, no professional guidance etc when they directly approach Government banks. Therefore it is advised for students to go through VidyaLoans as our team will connect you with the best Government bank with lower interest rates. They will help you in each and every step and will assist you throughout the education loan process in India.
Why should you apply through Vidya Loans?
VidyaLoans loans is an organization which helps students to secure non-collateral loans from government banks up to 7.5 lakhs in India. Vidyaloans will help you apply through various Government banks and will assist you throughout the loan process.
- Lower interest rates
One of the biggest advantages of applying through VidyaLoans is that our team shares a professional affinity with sanctioning officers and manages to keep a close check on your loan application status. - Faster processing of loans
Government banks provide education loans to students, but at a very slow pace. But if you apply through VidyaLoans, our rapport with the concerned banks makes it possible to process your loan in 12 to 15 days. - Professional assistance throughout the loan process
There are multiple education loan providers in India. Students who are directly processing for an education loan by Govt. banks, they are often not assisted and guided properly. If you process through VidyaLoans, from filling up all the required details on Vidyalakshmi portal to your education loan sanction, the processing officer will help you throughout the loan process. Our team will guide through the entire loan process and will assist you to cross each and every step under professional expertise.
Therefore, it is suggested that students who are considering different alternatives to fund their education in India and looking for right financial guidance may connect with our processing officers at VidyaLoans. They will help you apply through various banks and will help you process your education loan without collateral in the stipulated time frame.
About the organization: VidyaLoans is an organization which helps Indian students in India to secure a non-collateral loan from Government banks up to 7.5 Lakhs. We have a dedicated team of professionals who assist students with queries and guide them throughout the loan process. Our Team at Vidyaloans is committed to sanction the best loan option suiting the applicant's profile and needs, in a stipulated time frame.