Dr Ambedkar Central Sector Scheme of Interest Subsidy on Education Loans is an initiative by the Ministry of Social Justice and Empowerment of the Government of India. The scheme provides interest subsidies on education loans to Other Backward Classes (OBCs) and Economically Backward Classes (EBCs). The main aim of the scheme is to promote the educational advancement of students belonging to these categories. It provides interest subsidy during the moratorium period to pursue approved courses of studies abroad at the Master, M.Phil., Ph.D. level. Let’s discuss all the features, benefits, and other details!
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What is Dr. Ambedkar Scheme of Interest Subsidy on Education Loans?
The Dr. Ambedkar Scheme of Interest Subsidy on Education Loans is a Central Sector Scheme applicable for higher studies abroad. The scheme is restricted to students enrolled in courses at the Masters, M.Phil., and PhD levels. It should be noted that the interest subsidy on the scheme is available only once either for Masters or Ph.D. level. Applying for an interest subsidy scheme can help you save a lot on interest rates and is considered one of the best ways for students to finance masters abroad. Below are some major features of this scheme-
- Eligible candidates- Only students belonging to the OBCs and EBCs can apply for this scheme. There are many study abroad loans for OBC category students and when OBC students apply for these loans they can ask the banks to consider them for this interest subsidy scheme by submitting the required documents. This way the candidates can save a lot on the interest rate.
- Reservation for female candidates- The scheme also provides a minimum of 50% reservation for female students i.e., a minimum of 50% of the total allocation under the scheme every year is reserved for female candidates.
- Eligible loan amount- The eligible loan component is the actual education loan amount taken subject to a maximum of INR 20 Lakhs for the purpose of interest subsidy claim.
Eligibility
It is important to know about the eligibility criteria for any scheme. Knowing about eligibility makes it easier for students to apply for the right scheme as per their requirements. Below are the eligibility criteria for this scheme-
- Securing admission- The student should have secured admission in the approved courses at Masters, M.Phil, or Ph.D. levels.
- Loan from a scheduled bank- Students should have availed loans from a scheduled bank under the Education Loan Scheme of the Indian Banks Association (IBA).
- Providing caste certificate- For the candidates applying under the OBC Category, it is mandatory to submit an OBC caste certificate, issued by the competent authority, to the banks.
- The income ceiling for OBC candidates- The total income of the employed candidate or of parents in case of unemployed candidates shall not exceed the present Creamy Layer Criteria.
- The income ceiling for EBC candidates- The total income of the employed candidate or of parents in case of unemployed candidates shall not exceed INR 8 Lakhs p.a.
How To Apply For Dr. Ambedkar Scheme of Interest Subsidy?
This scheme helps a lot of students and many apply for it each year. A common question that comes to the minds of eligible candidates is how to apply for this scheme. Below are the steps mentioned for the same-
- Step 1- To be considered for this scheme you’ll have to avail education loan from a scheduled bank under the Education Loan Scheme of the Indian Banks Association (IBA).
- Step 2- After selecting your bank, inform the loan department of the bank that you would like to apply for Dr. Ambedkar Central Sector Scheme of Interest Subsidy.
- Step 3- The nodal bank will implement the scheme as per the Memorandum of Understanding signed between the bank and the Ministry of Social Justice and Empowerment.
- Step 4- The bank will ask you to submit your Income Certificate and OBC Certificate (for OBC candidates). After verifying these documents the bank will consider you for this scheme provided your loan amount is below or equivalent to INR 20 Lakhs, which is the upper limit of this scheme.
- Step 5- The nodal bank after consultation with the Ministry will sanction your interest subsidy and inform you about the same.
Documents Required for Dr. Ambedkar Scheme of Interest Subsidy
To avail of this interest subsidy scheme, you are required to submit a set of documents to the bank to establish your eligibility and income details. Below is the list of the same-
- ITR/ Form 16/ Audited Accounts.
- An income Certificate issued by the authority of the State Government/UT Administration.
- For the candidates applying under the OBC Category, it is mandatory to submit an OBC caste certificate, issued by the competent authority.
FAQs on Ambedkar Scheme of Interest Subsidy on Education Loans
Yes, only students taking admission in Masters, M.Phil, and Ph.D. are eligible to apply for this scheme.
The scheme is implemented by the Nodal Bank as per the MoU between the banks and the Ministry of Social Justice and Empowerment.
Yes, there is a 50% reservation for meritorious female candidates.
Students taking this interest subsidy scheme should note that the eligible loan component is the actual education loan amount taken subject to a maximum of INR 20 Lakhs for the purpose of interest subsidy claim.
Only OBCs and EBCs candidates pursuing a course of study at the Masters, M.Phil. or Ph.D. level can apply for this scheme.
This blog was all about the details regarding the Dr. Ambedkar Central Sector Scheme of Interest Subsidy on Education Loans. To know more about such interest subsidy schemes, 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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