Public sector banks in India understand that lack of funds restricts aspiring students to pursue higher education domestically as well as abroad. Thus, to provide them with the desired funds, public sector banks provide collateral-free education loans of up to INR 7.5 lakhs and secured education loans vary in terms of maximum finance offered, interest rates, moratorium period, processing fees, and other factors.
In this blog, we will take you through the benefits of education loans from government banks and the list of public sector banks in India providing education loans to help you compare them to the above-discussed factors.
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List of Public Sector Banks Providing Education Loans
Now that we know about benefits of taking education loans from public banks, let’s find about the best banks that offer education loans to study in India and Abroad. Some of the top banks are SBI, Axis Bank, Bank of Baroda, Canara Bank, Punjab National Bank, and IDBI Bank.
State Bank of India
State Bank of India is one the top public banks providing education loans students to like skill loans, scholar loans, higher education loans in India and abroad. It offers various loan schemes like the SBI Student Loan Scheme and SBI Ed-vantage Scheme along with various interest subsidy schemes like CSIS Scheme and Dr. Ambedkar Interest Subsidy Scheme for overseas education. The SBI Loan disbursement process is also very simple, smooth and hassle-free. The table below shows details of education loan from SBI Bank-
| Particulars | Details |
| Quantum of Finance | For abroad – Upto INR 1.5 crore |
| Interest Rate | For abroad – 8.8% (Men); 8.3% (Women) |
| Processing Fees | INR 10,000 + taxes on loans above 20 lakhs |
| Loan Tenure | 15 years |
| Moratorium Period | Course period + 6 months |
| Margin Money | 10% |
Bank of Baroda
Bank of Baroda offer instant education loans to students to study in India and abroad. It offers services like Digital education loans, skill loan scheme, BOB forex cards and many others. The loans can also be applied through a government portal – Vidya Lakshmi Education Loan Bank of Baroda aside from visiting the bank branch or applying online.
| Quantum of Finance | For abroad – Upto INR 80 lakhs |
| Interest Rate | For abroad – 7.75% (Men); 8.25% (Women) |
| Processing Fees | INR 10,000 + GST |
| Loan Tenure | 15 years |
| Moratorium Period | Course period + 6 months |
| Margin Money | Above INR 4 lakhs – 10% |
Canara Bank
Aspiring students can get Canara Bank Education Loan, which is a well-known public-sector bank offering good services to its customers. It can also be applied through Vidya Lakshmi Portal. Bank doesn’t require collateral for education loans up to INR 7.5 lakhs. The Canara Bank Loan Disbursement Process is seamlessly integrated and loans are also processed quickly.
| Quantum of Finance | Upto INR 40 lakhs |
| Interest Rate | 7-10% |
| Processing Fees | NIL |
| Loan Tenure | 15 years |
| Moratorium Period | Course duration |
| Margin Money | 5-15% above INR 4 lakhs for study abroad |
Bank of India
Bank of India Education Loan interest rates are low, affordable and competitive which makes it a great choice to secure education loans. There are no hidden charges that helps in trouble free loan closure with minimal documentation work. Students can apply for loan by visiting the nearest BOI branch or online and be relaxed as the BOI Education Loan Disbursement Process is hassle free.
| Quantum of Finance | For abroad – INR 150 lakhs |
| Interest Rate | 8.85% – 9.85%Up to 7.5 lakhs- 1 year RBLR + 1.70% Above 7.5 lakhs- 1 year RBLR + 2.50% |
| Processing Fees | For abroad – INR 5000 |
| Loan Tenure | 15 years |
| Moratorium Period | Course Duration |
| Margin Money | 10- 15% |
Central Bank of India
Central Bank of India is another public sector bank providing education loans for India and abroad. These are offered for a wide range of courses from engineering and medicine to maths and science. Eligible students who have secured admission through entrance exams or merit submitted all the valid documents and signed the loan sanction letter can benefit from the quick Central Bank of India Loan Disburemsent process.
| Quantum of Finance | 20 lakh for studies abroad |
| Interest Rate | 8.10- 10.6% |
| Processing Fees | Loans upto INR 10 lakhs – INR 500Loan above INR 10 lakhs – INR 1000 |
| Loan Tenure | 15 years |
| Moratorium Period | Course duration |
| Margin Money | 10- 15% |
Karur Vysya Bank
KVB is one of the banks that provides seamless services and possible for you to achieve your educational goals. Karur Vysya Bank education loans have zero processing fees and the bank transfers the loan amount to the university’s account where you have secured admission. With no margin money up to INR 4 lakhs and a repayment period of 15 years, the bank provides education loans to study in India as well as abroad.
| Quantum of Finance | For abroad – INR 150 lakhs |
| Interest Rate | 12.05% to 14.55% |
| Processing Fees | NIL |
| Loan Tenure | 15 years |
| Moratorium Period | Course duration |
| Margin Money | NIL up to 4 lakhs 5% upto 7.50 lakhs 15% above 7.50 lakhs |
Indian Overseas Bank
India Overseas Bank is another public sector bank in India providing education loans under various schemes and facilitating students to pursue higher education. Regular full-time degree courses and full-time management courses are considered eligible courses under the education loan scheme.
| Quantum of Finance | For abroad studies – INR 40 lakhs |
| Interest Rate | 10.05% |
| Processing Fees | NIL |
| Loan Tenure | 10- 15 years |
| Moratorium Period | Course duration |
| Margin Money | 5-15% |
Punjab National Bank
Punjab National Bank provides education loans to study in India under its ‘PNB Saraswati’ and abroad under ‘PNB Udaan’ schemes. You can also easily get an education loan through the Vidya Lakshmi Portal Punjab National Bank. Aspiring students must fulfil eligibility criteria as stated by the bank and apply for desired courses and universities.
| Quantum of Finance | Need-based finance subject to margin as per guidelines |
| Interest Rate | 11.50% to 12.75% for men 11 % to 12.25% for women |
| Processing Fees | For abroad studies- 1% Minimum Rs.10000/- (Refundable after 1st Disbursement) |
| Loan Tenure | 15 years |
| Moratorium Period | Course duration |
| Margin Money | NIL up to 4 lakhs 5% upto 7.50 lakhs 15% above 7.50lakhs |
Bank of Maharashtra
Bank of Maharashtra education loan is another one in the list of public sector banks in India providing education loans. Students pursuing technical, professional, bachelor’s, master’s, and doctoral courses can apply for the same. The loans are provided at interest rates starting from 9.45%. The Bank of Maharashtra education loan disbursement process is simple and online.
| Quantum of Finance | Need-based financing |
| Interest Rate | 9.45% |
| Processing Fees | 0.50% of the loan amount for studies abroad (the amount is refundable incase borrower takes up the course) |
| Loan Tenure | 15 years |
| Moratorium Period | Course Duration |
| Margin Money | NIL up to 4 lakhs 15% above 4 lakhs for study abroad |
Indian Bank
Indian Bank is a public sector bank in India providing multiple services including education loans. The CIBIL score of the applicant should range between 65-0700 to avail funds from the bank. Indian Bank education loan interest rates are also affordable starting from 8.80% to 11.40% with flexible repayment options. Indian Bank education loan disbursement process is also quick and students can expect to get it done soon after receiving the acceptance letter and visa approval.
| Quantum of Finance | Need-based finance which is subject to margin as per guidelines |
| Interest Rate | 8.80% to 11.40% |
| Processing Fees | Upto ₹10 lakhs: Nil Above ₹10 lakhs: 0.15% (max. ₹3000.00) |
| Loan Tenure | 10- 15 years |
| Moratorium Period | Course Duration |
| Margin Money | 5-15% |
Benefits of Education Loans from Public Sector Banks
Deciding to choose the right lender among public banks, private banks, and NBFCs can be challenging. Each lending institution offers a set of pros and cons. However, many public sector banks offer many advantages, making it a preferable choice to secure funds from them. Let’s briefly find out as to why many students prefer to take study abroad education loans from public sector banks-
- Public Banks offer education loans at competitive and lower interest rates.
- Unlike private banks, public banks do not charge partial or full interest during the moratorium period.
- Banks charge a processing fee to process and sanction your loans. The processing fee charges are lower in public banks.
- No prepayment charges are levied by public banks.
FAQs
Some of the best public sector banks in India providing education loans are SBI, Canara Bank, Bank of India, Central Bank of India, Karur Vysya Bank, Indian Overseas Bank, PNB, Bank of Maharashtra, and Indian Bank.
SBI is the best public sector bank providing education loans at interest rates starting from 8.30% for women.
Interest rates on education loans in government banks are lower in comparison to private banks ranging from 8%-15% depending on the creditworthiness of the applicant and the course and university applied in.
Absolutely. Banks like SBI. Karur Vysya Bank and Bank of India provide up to 1.5 crores of education loans to study abroad.
Some of the reasons for public sector bank education loan rejection are due to incomplete applications, fake documents, low credit scores, and multiple loan enquiries.
This was all about public sector bank education loans and the benefits of education loans from government banks
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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