Education Loan

Education loan helps you fund quality education for a successful life.


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Today, education costs have touched sky-high. Parents invest in mutual funds, ULIPs, etc. so that their long term needs are taken care of.

Yet, some may suffer shortage of funds. An education loan thus, plays a vital role in funding the shortfall.

Students can avail an education loan for pursuing quality higher education in an institution of repute. However, prior to approaching the bank for availing an education loan, it is vital for students to understand the loan terms and conditions as well as procedure for applying for such loans. They should compare the interest rates and other important things before they zero in on a bank for an education loan. Evaluating the repayment ability is equally important for the applicant. An education loan can be repaid in five to seven years.

Types of Education Loans

Study Abroad

Study Abroad

These types of education loans that are meant for applicants who plan to study abroad. Typically, every lender will have a list of institutions that they support. In case the applicant has already secured a seat in any of these listed institutions, then the loan will be approved.

Domestic loans

Domestic loans

Domestic loans are for those, who wish to pursue a higher education in India. Every lender will have eligibility criteria for education institutes in India as well.Here too, the loan will be approved in case the applicant has secured admission in an institute which meets the requirements of the bank.

Undergraduate loans

Undergraduate loans

Undergraduate loans are those types of education loans that provide financial support to pursue undergraduate degree programs.

Graduate loans or Professional loans

Graduate loans or Professional loans

Graduate or professional loans are those kind of loans which are tailored for applicants who wish to pursue post-graduation or any other related professional courses.

Career loans

Career loans

Career loans are those types of education loans which help applicants pursue career-oriented programs as well as certification courses.

Education Loans ...

Education loan online in India can be applied in the below steps, though it may vary from one bank to another.

  • Step 1: Application Form: Fill in the application form with details pertaining to your academics as well as your contact details. It is vital to fill in all the correct and accurate information.

  • Step 2: Personal Discussion: Once the form filling of the applicant is done, there would be a personal round held wherein he/she may be asked several question related to the course opted for, academic performance, details on the educational institute etc. The student applicants should be clear and lucid about the selection of course and well as its future potential to generate income. There are certain banks that consider academic record vital whereas some banks might pay a lesser attention.

  • Step 3: Document submission: You need to submit the documents related to the admissions even before applying for the education loan application. The enrollment of the student will be done by the bank from the concerned institute. At times even collateral security would be required such as property papers for mortgaging in case the loan amount is above Rs.4 lakhs

  • Step 4: Loan Approval or denial: n case of application of the education loan, a co-guarantor is compulsory. This guarantor may be your guardians or your parents. The guarantor’s CIBIL score would be verified by the bank for loan approval. Your loan might be denied or approved once the loan process is completed.

  • Step 5: Borrower’s signature on a Promissory Note: While the parents/guardians are guarantors, the student is the actual borrower of the loan. Once the loan is sanctioned, the student has to sign a promissory note to the bank.

  • Step 6: Loan disbursal: On completion of the loan formalities, the loan disbursal would be done by the bank. The bank may disburse the college/institute fee directly to the concerned institute.

Education loan EMI calculator is a tool which is simple and it helps in saving your time as well as quite scalable. The below mentioned inputs would be required to use the Education loan EMI Calculator:

  • Loan Amount- Enter the loan amount applicable.
  • Duration- Enter the tenure of the loan.
  • Interest Rate in %- Enter the rate of interest applicable to your educational loan.
  • Processing Fee (% of Loan Amount) – Update the amount of the processing fee applicable to your loan amount. In case you aren’t aware of this processing fee, it is advisable to consult your bank directly.
  • Option of Pre-Payments? – Depending on your bank of whether there is an option of making pre-payments, you may choose ‘Yes’ or ‘No’. The education loan EMI calculator will consider your choice and appropriately give you the figure.
  • Calculate- All you need to now do is click on the ‘calculate’ button and the education loan calculator will give you the EMIs applicable to your educational loan in India. It will also share the details like amortization information

Some of the frequently asked questions about Education Loans

Mentioned below are the features of the Education loan:

  • Anyone can access easily
  • Finances in Indian as well as foreign courses
  • Offers 100% finance options
  • Tailor-made loan amounts
  • The applicant’s annual family income as well as course opted is taken into consideration to decide the education loan amount.
  • In case of minority students, government sponsored subsidies are available
  • Once the course is completed, the repayment period initiates


Mentioned below is the eligibility criteria for Education loans in India.

  • You should be an Indian resident.
  • You should have already secured an admission in a recognized educational institution.
  • You must have a valid passport in case you are a non-resident Indian (NRI).
  • You will need to complete your higher secondary level schooling
  • Collateral is not required if the education loan amount is up to Rs.7.5 lakhs. In case of a higher loan amount, you will have to offer a collateral/ security which is enforceable in India.
  • Certain banks may have an age limit for education loan applications. However, RBI doesn’t have any restrictions on the same.

Mentioned below is the list of documentation that is needed for application of Education loan:

  • Fully filled loan application form
  • Documents representing your age (self-attested)
  • ID as well as address proof
  • Highest educational qualification copies
  • Applicant’s as well as the guarantor’s passport sized photo
  • Income proof of the guarantor/ parents
  • Applicant’s or guarantor’s or the parent’s six months bank statement
  • Details of collateral security in case applicable
  • Established documents such as passport /visa-copy, airfare price for studying abroad

Different lenders will offer different modes of repayment options for repaying the loan. Mentioned below are some of the loan repayment options for education loan:

  • Online payments: Usually, every bank or a financial institution will have a mobile application or net banking portals wherein you can make the payment online. To avail this facility you will have to login to the netbanking facility of the particular bank.
  • Deduction against salary: The EMI amount would be debited directed from your salary once you are employed
  • Demand draft: You may also do the education loan repayment using a demand draft
  • Cheque: Before the monthly due date, you can write a cheque addressing the bank. Mostly, such types of repayment options are opted for foreclosure of the education loan.
  • Direct debit system: You can give standing instructions to your bank for deducting the EMI on monthly basis on a particular date till the end of the education loan tenure.

Whats Covered..

Education loan offers coverage for the basic fees as well as other related expenses.

• Tuition fees & Course fees
• Caution deposit
• Travel expenses as well as passage money for studying abroad
• Any other expenses that are needed for completion of course such as study tours thesis or project related costs.
• Expenses related to books, equipment’s and other instruments.


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Calculate your Needs?

Many questions may come in your mind before deciding on the Loan. ‘How much Loan I would need, how many years I shall invest for, what would be the EMI’s, etc. Loans Calculators are life-savers. They help you know your needs and assess the potential costs. Grey Font brings to you various Loans Calculators and interactive tools to help you calculate your needs. In order to get better results, ensure to enter a value in all the possible fields.


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