Minimum Family Income Requirements for Education Loan: Securing higher education in the home country or studying abroad is a great asset but financial burdens often stand in the way. Thus, securing education loans can help students and their families to finance expenses. But, before applying for education loans, one crucial factor to consider is the minimum family income required to be eligible for education loans. In this article, we will discuss the education loan eligibility criteria and minimum family income for education loans.
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Also Read: We have compiled a list of Top Indian Banks providing Education Loans to Study in the USA. Check out our blog and familiarize yourself with how to finance your studies in the US.
Minimum Family Income for Education Loans
As discussed, different lenders have different policies when lending education loans. High-achieving students who have qualified for the eligibility criteria are offered education loans at cheaper interest rates with flexible terms and conditions.
Minimum Family Income Norms in Private Banks
Private Banks providing education loans have strict income norms in comparison to government banks and NBFCs. The reason behind this is that you are required to start paying simple interest as soon as the loan amount is credited to your account.
Since these banks know that you don’t have a source of income to start paying for the instalments, they have minimum family income requirements for education loans.
Let’s have a look at the minimum family income requirement for education loans from different banks.
| Bank | Minimum Family Income for Education Loan |
| RBL Bank | Minimum Rs. 20,000 per month (2.4 lakhs per annum) |
| IDFC First Bank | Minimum Rs. 30,000 per month |
| Axis Bank | Minimum Rs. 37,500 per month (4.5 lakhs per annum) |
| IndusInd Bank | Minimum Rs. 40,000 per month (4.8 lakhs per annum) |
| HDFC Bank | For HDFC Salary Account Holder: minimum Rs. 25,000 per month For Non-HDFC Account Holder: minimum Rs. 50,000 per month. |
| ICICI Bank | Minimum Rs. 50,000 per month (co-applicant) |
Minimum Family Income Norms in Government Banks
Many government banks in India provide unsecured education loans up to 7.5 lakhs. On loans above 7.5 lakhs, you are required to pledge collateral with the bank like your house, vehicle, or agricultural lands.
To get a secured education loan with government banks, you don’t need to show income-proof documents as income doesn’t matter. However, it is always better to have an income certificate. What is more important than income is the credit score of the applicant or co-applicant. It should be above 650-700. An individual applying for an education loan with a low CIBIL score may not be able to get a loan from the bank.
Check out the reasons for education loan rejection with a good credit score.
Minimum Family Income Norms in NBFCs
Just like government banks, NBFCs education loans to pursue study abroad dreams are a great option to consider. They generally do not look at family income but consider and predict your future income to sanction the education loans.
To be eligible for an education loan with NBFC, you need to have a CIBIL score above 650. However, if you have been admitted for your higher education in a university that is not in the top 200s, then NBFCs require a family income between Rs. 25,000 to Rs. 30,000.
Also Read: Having a low CIBIL score but still want to secure an education loan? Check out our blog on How to Increase your CIBIL Score for better Education Loans?
Eligibility Criteria for Education Loans
Different banks and financial institutions have different eligibility criteria listed for education loan borrowers. To be eligible for education loans, you must be an Indian citizen within the 18-35 years of age bracket.
You must have secured admission to a recognized university in India or abroad to pursue undergraduate/ postgraduate/ PG Diploma courses. Some lenders ask for a good academic record while others look at the income of the parents or the co-borrower. It means that the co-applicant must have a stable income source and a good credit source to avoid loan rejection. You must show your willingness and take the responsibility to pay back the loan. This helps in increasing your chances of securing an education loan with top Indian banks.
The table below will help you understand the eligibility criteria in a better way.
| Particulars | Eligibility |
| Nationality | Indian Citizen |
| Age | Minimum 18 yrs; Maximum 35 years |
| University Applied | Recognized University- India or abroad |
| Qualification | Pursuing graduate/ post-graduate/ or PG diploma |
| Admission Status | Confirmed |
| Income | Stable Income of parent/ guardian |
If you planning to secure education loans to pursue your study abroad dreams in the UK, check out our blog on Top Indian Banks providing Education Loans to Study in the UK.
FAQs on Minimum Family Income for Education Loan
The minimum salary for parents for education loans should be Rs. 25,000 per month.
Different lenders have varied minimum salary brackets for working professionals. Typically, the minimum salary to apply for an education loan is Rs. 30,000 per month.
The applicant’s/co-applicant’s or guarantor’s minimum annual income for education should be 4.5 lakhs. However, some banks provide education loans if the family income is less than 4.5 lakhs. But, some banks also require a minimum family income of more than 4.5 lakhs.
Yes, you can get an education loan even if your parents are unemployed. Some banks and financial institutions offer education loans without collateral to help students and their families cover the expenses associated with education.
Any Resident Indian can apply for the loan. The loan applicant’s minimum age should be 18 years and the maximum should be 35 years. Students should have secured admission to a higher education course in recognised institutions, in India or abroad.
This was all about minimum family income for education loans. Different banks and financial institutions have varied minimum and maximum family income requirements. Typically, individuals earning at least INR 30,000 per month are considered eligible to be named as education loan co-applicants. Lenders do consider individuals who earn lesser monthly salaries as co-applicants. However, INR 30,000 is the recommended minimum monthly salary.
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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