RBL Bank’s education loan interest rate is one of the most competitive rates offered by private banks in India. The rate of interest on education loans from RBL Bank may vary upon various factors such as the credit score of the applicant and co-applicant, the amount of loan and the university where the student is getting admission. RBL Bank is one of the best private sector banks that offers education loans and other types of loans to students and salaried individuals. Along with the education loan, you can also get an RBL Bank Forex card or other financial services required.
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What is the RBL Bank Education Loan Interest Rate?
RBL Bank offers education loans with interest rates starting from around 10% per annum. The rate of interest depends on the loan amount, course, and the applicant’s credit report. RBL Bank education loan provides flexible repayment options of up to 180 months and loan amounts of up to INR 2 crore. This much amount of low rate of interest helps students to pursue higher education without financial stress.
Also Read: Want a personal loan from RBL Bank? Check here for the details on RBL Bank personal loan interest rate
How Interest Rate is Determined by the Bank?
Interest rate on education loans is based upon various factors like changes in RBI’s policy, inflation rate, credit score of the borrower etc. Let’s understand in detail about all these factors and how the bank determines the interest rate.
Central Bank Policy
The policy of the central bank i.e. the Reserve Bank of India (RBI) set benchmark interest rates. This serves as the basis for banks’ lending rates. Changes in these rates directly impact how much banks charge for loans and pay on deposits. All banks in India work as per the guidelines set by the RBI.
Inflation
Banks consider inflation while determining interest rates on education loans. Higher inflation usually leads to higher interest rates to maintain the real value of money, as lenders want to ensure they are compensated for the decreasing purchasing power of money over time.
Credit Risk of the Borrower
The creditworthiness of the borrower plays a significant role in determining the interest rate. Individuals or businesses with a higher credit risk (due to poor credit scores, bad repayment behaviour, etc.) are charged higher rates to compensate for the increased chance of default.
Loan Tenure
Some banks and financial institutions determine interest rates considering the repayment period. An education loan with a longer repayment period attracts a high rate of interest. Also, longer repayment periods make the loan costlier but it comes with low EMIs. Compare the total repayment amount and then choose the repayment tenure.
Type of Loan
The type of education loan is a major factor that is considered while deciding the rate of interest. An unsecured loan comes with a higher interest rate because it involves more risk as compared to a secured loan. In secured loans, the collateral can be auctioned by the bank if the borrower is not able to repay the loan and that’s why it comes with a low interest rate.
RBL Bank’s education loan interest rate is calculated based on multiple factors. Always check and compare interest rates on education loans before applying for the same. Check some common FAQs based on the RBL Bank education loan below.
Also Read: Studying abroad with an education loan? Check here all about income tax rebate on education loan.
FAQs
RBL Bank offers competitive education loan interest rates starting from around 10% per annum. The exact rate depends on factors such as the loan amount, the course of study, and the applicant’s credit score.
RBL Bank determines the interest rate based on various factors such as the Reserve Bank of India’s policy, inflation rates, the borrower’s creditworthiness, and the loan tenure.
Yes, along with education loans, RBL Bank provides various financial services for students, such as Forex cards for international transactions. This helps students manage their finances while studying abroad.
The borrower’s credit score is important in determining the interest rate. A higher credit score usually results in a lower interest rate, while a lower score may lead to higher rates due to the increased risk of default.
A longer repayment period for an education loan might come with a higher interest rate which makes the loan costlier overall. However, it offers lower monthly EMIs, which can ease financial stress during repayment.
To know more about education loans, the best bank accounts for students, forex and banking experience for global students or international money transfers, reach out to our experts at 1800572126 to help ease your study abroad experience.
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