Kotak Mahindra Bank Education Loan Interest Rate: Calculation, Major Factors

Kotak Mahindra Interest Rate
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If you are looking to apply for Kotak Mahindra Bank education loans, you must know the interest rates at which the bank offers its services. With maximum education loans to study abroad up to INR 20 lakhs, the applicable interest rates range from 8.50% p.a. to 16.75% p.a. Let’s check the important details on Kotak Mahindra Bank education loan interest rates in this blog.

Kotak Mahindra Bank Education Loan Interest Rate

Kotak Mahindra Bank offers education loans to study abroad up to 16.75% p.a. The interest rates are floating and change from time to time with revisions in the bank’s terms and conditions, policies and RBI guidelines on education loans. The interest rates on Kotak Mahindra education loans differ based on the amount of loan availed.

  • For loans up to INR 7.5 lakhs, the interest rate ranges from 11.50% to 24%.
  • For loans above INR 7.5 lakhs, the interest rate is 15.75%.
  • A 0.50% concession is given to female students.

Interest Rate for Male Students

Loan AmountInterest RatesEffective ROI
Upto INR 4 lakhsBase rate + 7.25%8.50% + 7.25% = 15.75% p.a.
Above INR 4 lakhs base rate + 8.25%8.50% + 8.25% = 16.75% p.a.

Interest Rate for Female Students

Loan AmountInterest RatesEffective ROI
Upto INR 4 lakhsBase rate + 7.25%8.50% + 7.25% = 15.75% p.a.
Above INR 4 lakhs base rate + 8.25%8.50% + 8.25% = 16.75% p.a.

Recommended Read: Planning to take an education loan from Karnataka Bank? Check out all the details about Karnataka Bank education loan interest rates

Calculation of Kotak Bank Interest Rates

Kotak Mahindra Bank education loan interest rates are calculated as the sum of the Base Rate and the Spread. The bank’s rate of interest is linked to the base rate plus the spread. Spread is calculated as the difference between the interest rates charged by the banks on loans to private banks and the interest rate paid by the commercial bank. 

Interest Rate = Base Rate + Spread.

The base rate of Kotak Mahindra Bank effective from July 16, 2023, is 8.50% p.a.

The table below talks about detailed information on the interest rates of these different lenders.

Karnataka Bank Education Loan Interest Rate
Federal Bank Education Loan Interest Rate
Canara Bank Education Loan Interest Rate
Union Bank Education Loan Interest Rate
PNB Education Loan Interest Rate
Bank of India Education Loan Interest Rate
Indian Bank Education Loan Interest Rate
SBI Education Loan Interest Rate

Factors Affecting Education Loan Interest Rates

Education loan interest rates keep on changing due to changing market conditions and RBI guidelines. These factors may include the amount of loan borrowed, the university/college and course of students’ choice, collateral pledged if any and repayment period. Let’s have a look at these factors in detail- 

  • The education loan interest rate is entirely decided based on the amount of loan borrowed. The larger the amount of credit allocated for the longer period corresponds to the higher risk level of the creditor. Subsequently, lending costs are high.
  • Schools and degree programs that are clear and the workers have better job prospects and careers enable lending institutions to offer discounts on education loan interest rates.
  • Another factor would be the qualification of the applicants /co-applicants for the loan. Having a good credit score at a bank allows them to offer lower interest rates. 
  • Collateral-free education loans carry an expensive interest rate as the creditors are not offered any security. The rationality of the lenders is to reduce risk because creditors do not have any collateral back-ups.
  • Education loan interest rates also face the RBI’s policy that sets the interest rate, which is dependent on the economy of the country. Political instability may make a student borrowing our education loans incur higher interest.

Also Read: Check out the FAQs on the Restructuring 2.0 Scheme of RBI that provides benefits to the borrowers affected by the COVID-19 pandemic. 

FAQs

What is the Kotak Mahindra Bank education loan interest rate?

The Kotak Mahindra Bank Education Loan interest rates range from 8.50% to 16.75% p.a. Education loans are provided at floating rates which are subject to revision every quarter.

What is the current interest rate on Kotak Mahindra Bank education loans?

As per the official website of the Kotak Mahindra Bank- for loans up to INR 7.5 lakhs, the interest rate ranges from 11.50% to 24% and for loans above INR 7.5 lakhs, the interest rate is 15.75%.

Can I choose between fixed and floating interest rates for a Kotak Mahindra Bank education loan?

Kotak Mahindra Bank provides education loans at floating interest rates, which are subject to revision every quarter. An applicant can’t avail of education loans at fixed interest rates from the Kotak Bank.

How are Kotak Mahindra Bank Education loans calculated?

Kotak Mahindra Bank Education Loan Interest Rate = Base Rate + Spread. The base rate of Kotak Mahindra Bank effective from July 16, 2023, is 8.50% p.a and the spread is between 7.25% to 8.25%.

What are the factors affecting education loan interest rates?

Factors that affect education loan interest rates are loan amount and tenure, choice of country and course, credit score, collateral provided, and economic conditions.

This was all about the Kotak Mahindra Bank education loan interest rates. Make sure to compare the interest rates provided by different lenders and then apply for education loans. 

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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About Shubhika Garg

Hey there! I'm Shubhika- a proud graduate in English Literature and Language from Delhi University. My journey as a content writer transitioned from online teacher into the world of words. Stepping into the domain of blogs and articles, I discovered my passion for writing growing deeper and stronger. Having said that, I have experience of writing for diverse industries in automobile, technology, ed-tech, finance and mental-health; crafting details to help you find the solution to what you are looking for. Join me as I invite you all explore and learn together.

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