Bank of India Education Loan Interest Rate

Bank of India Education Loan Interest Rate
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Bank of India is one of the oldest public sector banks in India. It was established in the year 1906 and nationalised later. The bank offers education loans under its dedicated scheme i.e. BOI Star Education Loan. The loan is available for both study-abroad and Indian students. Bank of India education loan interest rate is easily affordable and is determined in line with the IBA’s education loan model. You can also apply for a BOI education loan using the Vidya Lakshmi portal education loan. Check all the details on the Bank of India education loan interest rate for students going abroad for studies.

Also Read: Going abroad for studies? Check all the information on how the exchange rates are calculated while exchanging currency abroad

What is Bank of India Education Loan Interest Rate?

Bank of India education loans to study abroad is available at affordable interest rates. The bank mostly offers education loans for overseas students at a floating rate of interest. The floating interest rate is subject to revision every quarter and it may increase or decrease based on the economic conditions and the directions of the Reserve Bank of India (RBI). Check the details of the BOI Education loan interest rate below:

Loan Amount (INR)Rate of Interest
Up to 7.5 lakhs1 year RBLR + 1.70%
Above 7.5 lakhs1 Year RBLR + 2.50%

Bank of India Education Loan Interest Rate Calculation

Bank of India determines the interest rate on education loans based upon the RBLR i.e. Repo based Lending Rate. The bank adds the spread of 1-2% on RBLR to finalise the lending rate. The RBLR is determined based on the directions provided by the Reserve Bank of India. You should always check all details on interest rates before initiating the Bank of India education loan disbursement process. As per the information provided by the Bank of India, the current RBLR and repo rates are:

MonthRBLRMark-upRepo
01/02/20249.25%2.75%6.50%
01/01/20249.25%2.75%6.50%

Based on the above rates, the bank finalises the interest rate on education loans which the borrower is required to pay for the entire tenure of the loan. The interest rate also varies depending on the type of loan i.e. secured or unsecured. Also, a higher loan amount usually attracts a lower rate of interest.

Also Read: Want an education loan from a government bank? Check out all the information on Union Bank Education Loan through Vidya Lakshmi Portal

Factors Affecting Education Loan Interest Rate

Bank of India education loan interest rate can vary depending upon a lot of factors. Different banks have different rules, but here are some common things that can make the cost (interest rates) of the loan go up or down:

Base Rate/External Benchmark Rate

The cost of your education loan is often connected to a base rate or an external benchmark rate, like the Marginal Cost of Funds Based Lending Rate (MCLR) or the Repo Rate. If these benchmark rates change, it can affect how much extra money you have to pay on your education loan.

Loan Amount and Tenure

The education loan amount and the total repayment period may impact the interest rate. Usually, if you borrow a large amount, the bank might lower the interest rate. But if you borrow a smaller amount, the interest rate could be higher. For example, if you borrow INR 6 lakh, the Bank of India might make you pay 10.20% extra money, but if you borrow more than INR 7.5 lakhs, the interest rate could be 9.30%.

Collateral and Co-applicant

For a secured education loan, the bank worries less as there is an asset backing the loan. The bank might charge less interest rate for this type of loan. Usually, loans with security (collateral) have less extra money to pay compared to loans without security because the bank sees more risk in loans without security.

FAQs

What is the current interest rate on Bank of India education loans?

The interest rate on Bank of India education loans varies, but it usually ranges from 7.30% to 9.30%.

How is the interest on Bank of India education loans calculated?

Bank of India calculates education loan interest on a simple interest basis during the study period and then on a compound interest basis post-completion of the course.

Are there any special interest rate discounts available?

Yes, the Bank of India offers interest rate concessions for female students and those from economically weaker sections, making education loans more affordable.

Can I choose between fixed and floating interest rates for education loans from the Bank of India?

Yes, the Bank of India provides the flexibility to choose between fixed and floating interest rates for education loans based on the borrower’s preference. However, this may not be applicable in all cases and the bank may provide loans on floating interest rates.

Is there any provision for collateral-free education loans from the Bank of India?

Yes, the Bank of India offers collateral-free education loans for amounts up to Rs. 7.5 lakhs, making it accessible for students who may not have substantial collateral.

This was all about the Bank of India education loan to study abroad. Always go through the terms and conditions of the loan and the schedule of charges before applying for the same.

To know more about the loan application process, 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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About Shekhar Suman

Shekhar is a versatile writer with a passion for sharing knowledge and creativity. With expertise in crafting informative blogs on study abroad and finance, Shekhar helps readers navigate the complexities of education and financial planning. Most of his writings blend the practicality of finance and the beauty of language, making a meaningful impact in both spheres. Beyond his professional pursuits, he finds solace in the writing Shayari.

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