Education loans by State Bank of India (SBI) for various study programmes


The State Bank of India (SBI) is the largest and most successful pub Luc sector financial institution in the country. It is no surprise then that the bank offers some excellent student loan schemes for various courses in India and abroad. Including loans for UG, PG, Diploma and Certificate courses and vocational training. Check the loan scheme that you are eligible for.

Education has over the years become not just increasingly competitive but has also become very expensive. The cost of higher education both within the country and abroad has taken astronomical proportion. So much so that many who decide to go in for higher studies now require a conscientious effort for arranging funds to support their education. With the cost of education at undergraduate and postgraduate levels going into tens of lakhs education loans come as a blessing. There are many public sector and private financial agencies that offer education loans to meritorious students at fairly competitive rates of interest.



Among all the options available to you, education loans by government-owned banks are the best bargain. They offer loan to deserving students at much lower interest rates than private funding agencies, in addition to offering better terms and conditions. The education loan schemes of the following public sector banks are by far the best options available to Indian students looking for financial aid for pursuing higher studies.

Education loan from State Bank of India


The State Bank of India (SBI) is undoubtedly the largest and the most popular public sector bank in the country. It remains a preferred choice among individuals looking for an affordable financial option for higher education. SBI offers loans to students who have secured admission in recognised educational institutions, in professional and technical courses, in India and overseas. A distinguished academic record makes it easier to obtain an education loan with special interest rates.

SBI has various products to cater to the financial needs to students.

SBI Student Loan Scheme


Open to Indian nationals who have secured admission in undergraduate and postgraduate courses conducted by institutions approved by the AICTE and/or UGC. Admission in autonomous institutions such as IIMs, IITs and NITs etcetera, as well as recognised teacher's training/nursery training courses, are covered as well. Students pursuing degree/diploma courses in fields such as merchant navy and pilot training etcetera that are approved by a relevant regulatory body can also avail the loan.

Students heading abroad can apply for a loan for job-oriented courses at the UG and PG level. Courses such as MBA, MS and MCA and courses conducted by CPA in the States and CIMA in London etcetera get loan approval too.

No processing is charged, but a sum of five thousand needs to be deposited with the bank for loan amounts exceeding four lakhs for study abroad. This amount gets adjusted towards margin or against interest against the loan. The bank appropriates the money if the loan is not availed within four months of sanction.

All expenses pertaining to study are covered under the loan – tuition fees, accommodation/hostel/living expenses, travel expense for studies overseas, the expense for books, laptop, and library fees etcetera. The cost of sundry activities involving the higher studies is also covered.

The loan amount is ten lakhs for studies in India and thirty lakhs for studies abroad. Parents need to be co-applicants for loan amount up to four lakhs. For loan between 4lakhs and seven and a half lakhs, a third party guarantee is essential for collateral. The same can be overlooked if the co-applicants IT Returns indicate their earnings to be three times that of the loan amount. Loans over seven and a half lakh will require a tangible security, in addition to a co-applicant.

A 5% margin is needed for study in India and 15% for studies abroad for loan above four lakhs.

The repayment period varies between ten and twelve years depending on the sum of the loan. The loan repayment starts one year after the course or after six months of getting a job.

SBI Scholar Loan Scheme


SBI has generated a list of over hundred premier educational institutions in India and students who have secured admission in any of these institutions can apply for an education loan. The highlight of this scheme is the absence of processing fee and margin money. SBI provides 100% finance to deserving candidates.

Under the scheme, the loan is granted to students pursuing full-time degree studies or diploma courses, full-time Executive Management courses admission to which is through a selection process or entrance examination. SBI covers all expenses under the scholar education loan scheme, including tuition and hostel fee, caution deposit, library fees and also covers the cost of study material.

The list of institutions under this scheme is divided into 4 groups.

  • Loan amount for study in institutions that fall under group AA is thirty lakhs
  • Admission in institutions listed under group A can get you a loan sanction of twenty lakhs or thirty lakhs if a collateral security amounting to the entire value of the loan is presented
  • Institutions listed in group B get twenty lakh loan and those in group C are entitled to seven and a half lakhs loan
  • However, a higher loan of thirty lakhs is possible if collateral worth the amount is pledged to the bank

The loan can be repaid in twelve years and the repayment begins six months after the course is completed.

SBI Vocational Education & Training loan


SBI has other loan products that cater to students wanting to acquire vocational education and training in India. It is a term loan that provides 100% financing and does not require margin money or processing charges.

Applicants do not need to furnish collateral or third party guarantee. However, the bank will require parents/spouse/guardian to be co-applicants in the loan documents. Additionally, the bank does not charge a prepayment fine and applicant can pay the loan amount at any time within the loan period to bring down the interest.

Expenses covered under the loan include course fee, caution deposit, expenses for books and other equipment, library fee etcetera. Applicants requiring a loan for a period of up to six months can avail of a loan of fifty thousand rupees. Training programmes that stretch longer than six months are given a loan of one lakh.

The moratorium period varies from six months to twelve months after the course completion, depending on the length of the course. Repayment of loan commences after six months of the course or after getting employed, whichever happens first. The loan is to be repaid within three and five years, depending on the loan amount/period.

The loan is granted to Indian nationals who are admitted into a vocational programme managed or recognised by the government or supported by NSDC (National Skill Development Corporation). It must be a degree, diploma or certificate course issued by a competent authority.

SBI Global ED-Vantage scheme


The SBI Global ED-Vantage scheme is an exclusive product aimed at students looking for financial help to study abroad. The following are its key points in a nutshell –

  • The loan amount is upwards of twenty lakhs and up to one and a half crore with 80% of the cost of the course entitled for financing
  • There is no collateral required and the rate of interest is competitive
  • The SBI education loan is designed for UG and PG courses in management, engineering, sciences, mathematics and medicine in top universities in the USA, the UK, Singapore, Canada, Europe, Australia and Japan
  • Girl students are eligible for a concession of 0.5% on the interest
  • The loan can be repaid after completion of studies, through EMIs, over a period of 15 years
  • There is a six month grace period after the course completion to begin loan repayment


SBI Skill Loan Scheme


Students keen on mastering a particular art can avail of SBI loan to fund their education. The course has to involve specialised training. The present rate of interest is between 9.5%.

Eligibility


The eligibility for all education loans offered by SBI is more or less the same.

  • Loan is issued only to Indian citizens for studies within the country or abroad
  • The loan is processed only after admission is secured




Documents required


All student loan schemes under SBI require the following documents -
  • Loan application form filled and signed
  • Two passport photographs of applicant and co-applicant
  • Letter of admission
  • Statement of study cost
  • PAN card of applicant and co-applicant
  • Aadhar card of applicant and co-applicant
  • Proof of residence such as passbook, telephone bill, passport and electricity bill etcetera
  • Six months bank account statement of co-applicant and applicant if previously employed
  • Income Returns of co-applicant for the last two years
  • Statement of assets and liabilities of co-applicant
  • Form 16 or income proof (salary statement) of co-applicant
  • Education documents such as mark sheets and pass certificate of 10th, 12th and degree certificate or as applicable


Important note


The applicant must procure a life insurance policy for the term of the loan assigning it in favour of State Bank of India. Get more information on edcuation loans on the SBI website.

Here is a list of some other banks that are offering education loan -


Article by Juana
Juana is a freelance writer, with years of experience, creating content for varied online portals. She holds a degree in English Literature and has worked as a teacher and as a soft skill trainer. An avid reader, she writes on a variety of topics ranging from health, travel, education and personality development.

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