There are numerous opportunities opening up for students these days across different streams that weren’t available even until a decade ago.
Despite this, it is common for students to travel abroad to pursue higher education in order to ensure that their hard work is recognized by employers. Every parent desires to support what their children want to do in the future and their dreams. Tuition costs at foreign universities can sometimes be exorbitant, even for those with easy money. The cheapest education loan comes to your rescue at this time! Read on to find out about the different banks providing some of the cheapest education loan options to study abroad.
To be eligible for education loans in India, several general criteria must be met. Though there may be minute variations depending on the bank, to a great extent, this is what you can expect:
You should be between the age of 18 to 35 and must have a co-applicant which can be a spouse, sibling, parent, etc.
Education loans are available for a span of up to 7 years for all professional, post-graduate, and graduate programs like engineering, management, medicine, and many more.
A loan can incorporate miscellaneous fees like that of the library, lab, traveling, books, study tours, etc in addition to the tuition fees.
Repayment can be done with the help of electronic monthly installments commonly known as EMIs or post-dated checks.
The banks which are considered to be the best for providing education loans offer a moratorium period of about 6 months after the course is completed. During that period no payments towards the principal amount are supposed to be made. However, the payments for interest will continue. Banks do not need any security for education loans of up to 4 lakhs. Though, third party guarantees or collateral are needed if you are opting for loans of larger amounts.
Cheapest Education Loan Offered For Students in India
1. Indian Bank of State SBI
Provides one of the cheapest abroad education loan via the SBI Student loan schema. SBI is well-known in their home country and offers loans for all graduate, postgraduate, and professional courses, including MS, MBA, and others, at reputable universities. Education loans can be accounted for up to a maximum amount of 30 lakhs with collaterals or security deposits needed for loans of more than 7.5 lakhs.
Repayment can be done over a period of 10 to 12 years and can be extended up to 15 years in some cases. The loan margin requirement in terms of education loan is 15% and the interest rates are up to 2% over the base interest rate granted by SBI.
The complete interest payment can be done during the moratorium period, as a result, only principal payments are left after the loan tenure starts.
2. Bank Of Baroda
Bank of Baroda offers a diverse selection of education loans, characterised by their competitive interest rates, to cater to the needs of students. The maximum loan amount varies depending on the specific loan program selected by the student.
The following are the education loan by Bank of Baroda, ensuring students have access to the necessary financial support for their educational pursuits:
3. Central Bank Of India
Central Bank of India extends education loans to students pursuing studies both in India and abroad with interest rates as low as 8.30%.
The bank also provides special concession rates specifically designed for female students, promoting gender inclusivity in education financing.
Students can avail themselves of generous loan amounts, enabling them to meet the financial requirements associated with their chosen courses effectively.
Central Bank of India’s education loans aim to support students in their academic pursuits by providing them with accessible and affordable financing options.
4. Punjab National Bank
Another nationalized bank known to be one of the best and preferred banks for offering the cheapest interest rates for education loans is PNB. Through its Udaan program, it offers low-interest loans for education. Some benefits attached to it are:
Top universities that offer professional, diploma, graduate, and postgraduate courses in a variety of fields like science and technology, medicine, and so on are eligible for education loans. The loans pay for everything, including tuition, exam and textbook fees, travel, and other costs. The repayment period is of 15 years and their interest rate is specified at the bank’s base rate.
For the approval of education loans of more than 4 lakhs the loan margin requirement is 15%. Any scholarship availed by you can be added to this loan margin.
The moratorium period lasts up to a year and the complete interest payment can be made during the period. Also, there are no prepayment charges included.
In this blog, we have classified some of the major banks providing the cheapest education loans.
Though, there are still several other financial institutions that may support you in your quest. Go through every available option and choose the one that fits best within your parameters.
FAQs
1. How can I determine which education loan provider offers the lowest interest rates?
It is recommended to research and compare the interest rates offered by different banks or financial institutions. To get accurate information about the interest rates, you can visit their official websites, get in touch with their customer service, or talk to a loan advisor.
2. Are there any particular requirements that must be met in order to obtain the cheapest education loans?
The eligibility criteria may vary among different lenders. However, common factors include being an Indian citizen, having secured admission to a recognised educational institution, and meeting the prescribed academic requirements.
3. Are there any additional charges or fees associated with these education loans?
While the interest rate is a crucial aspect to consider, it is essential to inquire about other charges such as processing fees, prepayment charges, or any other applicable fees. These charges can affect the overall cost of the loan.
4. Do these banks or financial institutions have specific loan repayment terms?
Loan repayment terms, such as the duration of the loan and the availability of grace periods, can vary among lenders. It is advisable to review and understand the repayment terms and choose an option that aligns with your financial capabilities.
5. Are there any special benefits or schemes for certain categories of students?
Some banks and other financial institutions may provide special programs or benefits to particular classes of students, such as lower interest rates for female students or concessions for students from economically disadvantaged backgrounds.