It couldn’t be better. A number of financial institutions now offer education loan schemes at competitive rates of interest. The moratorium — repayment, in most cases starts six months after completion of the study programme or one-month after securing a job, whichever is earlier. The only rider is that study loans are sanctioned up to six times of the parents’ (co-guarantors) take-home salary. Some banks insist that at the time of the loan disbursal, the parents should not be more than 55 years old.
The interest rate
With most banks, the maximum amount sanctioned is Rs 7.50 lakh for inland studies and up to Rs 15 lakh for studying abroad. However, the rate of interest is a bit high, varying between 11.5 to 14.25 per cent.
Disbursement
The actual comes to about 90 per cent of the loan amount and covers everything from cost of stationary to travel in case the applicant wants to study abroad. The disbursement is either made in one go or term-wise/ year-wise instalments, directly to the college/ institution.
Collateral
Although students seldom default, most banks insist on collateral. This can be in the form of government securities, shares, debentures, bonds, LIC policies or equitable mortgage of property etc.
Courses financed
Currently, no bank is financing distance education/ correspondence/ certificate courses. Public sector banks have relaxed parameters for SC/ ST candidates.
Documents required
Mark sheets of the last qualifying exam; proof of admission; schedule of expenses for the programme; TOEFL, GMAT and GRE scores; I-20 admit card (for study abroad); copies of letter confirming scholarship (if any); copies of foreign exchange permits; two passport size photographs; statement of bank account for the last six months; income tax assessment proof; a brief statement of assets and liabilities; proof of birth and residence.
You can bank on them
SBI - 23368574-41494 or e-mail: sbipbbnd@ndf.vsnl.net.in
BoB, 24672407-5821
IDBI, 23357800-02 or log on to www.idbibank.com
Oriental Bank of Commerce - 25711367-8132 or log on to www.obcindia.com
Canara Bank - 26281535-6087 or e-mail: co.ndl@canbank.wipro.net.in
Documents required
Mark sheets of the last qualifying exam; proof of admission; schedule of expenses for the programme; TOEFL, GMAT and GRE scores; I-20 admit card (for study abroad); copies of letter confirming scholarship (if any); copies of foreign exchange permits; two passport size photographs; statement of bank account for the last six months; income tax assessment proof; a brief statement of assets and liabilities; proof of birth and residence.
You can bank on them
SBI - 23368574-41494 or e-mail: sbipbbnd@ndf.vsnl.net.in
BoB, 24672407-5821
IDBI, 23357800-02 or log on to www.idbibank.com
Oriental Bank of Commerce - 25711367-8132 or log on to www.obcindia.com
Canara Bank - 26281535-6087 or e-mail: co.ndl@canbank.wipro.net.in