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Canara Bank Education Loan in 2024: Interest Rates & Eligibility [Detailed Guide]

Canara Bank emerges as a steadfast companion, offering its tailored Education Loans to Indian students. This blog is your roadmap through the intricacies of Canara Bank’s student Loan’s terms and conditions, where we discover details on interest rates, eligibility criteria, the application process, and its secured and unsecured loan requirements. 


Key Takeaways- 

  • Canara Bank mainly offers 3 types of education loans for students studying in India and abroad- IBA Model Education Loan, IBA Skill Loan, and Loan Scheme For Pursuing a Master’s Degree Abroad. 
  • IBA Model Education Loan Scheme offers funding to students studying in India as well as abroad. This loan provides need-based finance. 
  • IBA Model Education Loan interest rate ranges from 9.25%-11.25%. 
  • IBA Skill Loan interest rate ranges from 9.25%-10.75%. This loan funds skill development courses run by Training Institute aligned to the National Skill Qualification Framework (NSQF). 


Canara Bank Education Loan Scheme For Master’s Degree Abroad


Canara Bank abroad education loan offers a specific education loan scheme for students pursuing Master’s degrees abroad. This scheme provides financial assistance to students who wish to study at top-ranked universities worldwide. Here’s a detailed explanation of the scheme: 


Loan LimitMinimum – Rs 7.5 lacs, maximum upto – 100% of the value of collateral
Co-applicantParents or guardians
Interest rateStarts from 10.40%
Loan Margin10% of the loan amount
Moratorium PeriodCourse duration + 1 year
Repayment DurationUpto 15 years after moratorium period
Canara Bank Education Loan Processing FeesFor less than 100% collateral value- Rs.10,000. For collateral value of 100% and above- Rs.20000 

IBA Model Education Loan Scheme For Higher Studies in India and Abroad


Canara Bank’s IBA Model Education Loan Scheme offers financial assistance to students pursuing higher education in India and abroad. This scheme provides a convenient and affordable way to fund your studies. Here’s a detailed breakdown of the loan scheme- 


Loan QuantumNeed-based finance
MarginUpto Rs.4.00 Lakhs – NilAbove Rs.4.00 Lakhs -Studies in India – 5%Studies abroad – 15%Studies abroad – 15%
Eligible CoursesFor India- Graduation, Post-graduation, including technical or professional courses from reputed colleges or universities approved by UGC (University Grants Commission) or Government

For Abroad- Course which leads to Graduation, Post-graduation or PHD, Post-graduate diploma etc. are eligible for studying abroad.
Moratorium PeriodCourse period+1 year
Repayment Duration15 years

Collateral Security For IBA Model Education Loan 


There is a different collateral security requirement for Canara Bank’s IBA Model Education Loan. It is based on merit and management quota categories. Refer to the table below- 

Management QuotaSecurityMerit QuotaSecurity
Upto Rs 4.00 LakhsNo collateral SecurityUpto Rs 7.50 LakhsNo collateral Security, loan will be covered under Credit Guarantee Fund Scheme for Education loans(CGFSEL) scheme subject to the conditions
Above Rs 4.00 LakhsTangible Collateral security to cover at least 100% of the loan amount.Above Rs 7.50 LakhsTangible Collateral security to cover at least 100% of the loan amount.

Canara Bank’s IBA Model Education Loan scheme is designed to empower students by offering competitive interest rates, flexible repayment options, and the added benefit of no prepayment penalties. This comprehensive financial support covers a spectrum of expenses, including tuition fees, travel, and living expenses. It gives the flexibility to pursue education at globally renowned universities. 


IBA Model Skill Loan Scheme


 Canara Bank offers the IBA Skill Loan Scheme, which supports individuals seeking to acquire new skills through eligible training programs. Here’s a detailed overview:

Quantum of loanNeed-based Finance in the range of Rs.5000 to Rs.1,50,000
SecurityAssignment of future income of the student Loan is granted jointly with the parents or guardians of the student the loan will be covered under the Credit Guarantee Fund scheme for Skill Development (CGFSSD) No collateral or third-party guarantee is required
MoratoriumFor course duration of up to one year: Moratorium is six months from the date of completion of course. For course duration is above one year: Moratorium is 12 months from the date of completion of course.
RepaymentFor loan amounts up to Rs. 50,000: Up to three yearsFor loan amounts above Rs. 50,000 and up to Rs. 1,00,000: Up to five years. For loan amounts above Rs. 1,00,000: Up to seven years

IBA Model Skill Loan Scheme covers courses run by Training Institutes aligned to National Skill Qualification Framework (NSQF). There is no minimum course duration.  


Canara Bank Education Loan Eligibility Criteria 


 The requirements to apply for a Canara Bank education loan are:

  • The applicant should be an Indian national. 
  • The applicant should have received admission to a recognised university abroad or in India depending on the loan type.
  • The applicant should be willing to submit acceptable collateral and its required documents. 


Documents Required For Canara Bank Education Loan


To acquire a loan from Canara Bank, both the applicant and co-applicant need to submit the required documents. Given below is the list of documents that need to be submitted- 

  • Copy of your passport
  • Identity Proof (PAN Card, Driver’s License, etc.)
  • Residence Proof (Aadhar Card, electricity or telephone bill)
  • Admission letter from the university
  • 2 passport-size photographs
  • Mark sheet of GRE, GMAT, TOEFL, IELTS (whichever is applicable)
  • Past academic certificates (X and XII mark sheets, Degree certificates, etc.)
  • University ranking printout

Documents required to be submitted by the co-applicant:

  • Identity Proof
  • 2 passport-size photographs
  • Residence Proof (Aadhar card, electricity or telephone bill)
  • Last 3 months’ salary slips
  • Income tax receipts for the last two years 
  • Form 16 for the last two years
  • Employee ID card (in case employed)
  • Proof of business address (if self-employed)
  • Last 3 years balance sheet and P&L statement


Collaterals Accepted For Canara Bank Education Loans


Collateral is an asset accepted as security from the loaner to extend a loan. Following are the two types of collaterals accepted by Canara Bank for their education loan:

  • Liquid securities such as government bonds or fixed deposit
  • Tangible collateral such as a house, a property or a plot of land with fixed boundaries, etc. 


Types of Canara Bank Education Loans 


In the sections above we saw the 3 main types of education loans Canara Bank offers. However, there are more such loan schemes the bank offers. Let’s briefly learn about them- 

Vidya Turant: 

This scheme offers hassle-free loans for students admitted to prestigious institutions like select IIMs, IITs, NITs, IISc, and ISB.

Vidya Sahay Education Loan Scheme: 

The purpose of this program is to assist deserving students who require financial assistance for the down payment to be submitted to the CET or counselling authorities during selection.

Vidya Shakthi Education Loan Scheme: 

This loan aims to support PWD category students with disabilities who require an education loan to pursue specialised courses related to assistive devices within India. Loans for studying abroad will follow the guidelines of the IBA Model Education Loan or Skill Loan Scheme. 


Canara Bank Education Loan Interest Rates


The table below consists of the interest rate ranges of all the education loan types offered by Canara Bank:

IBA model education loan9.25% – 11.25%
IBA skill loan 9.25% – 10.75%
Vidya Turant education loan8.60% – 9.85%
Vidya Shakthi9.25 – 11.25%
IBA model education loan9.25% – 11.25%
IBA skill loan 9.25% – 10.75%
Vidya Sahay loan11.25% 


Canara Bank Education Loan Repayment Process


The repayment procedure for an education loan from Canara Bank may extend up to 15 years, aligning with the maximum repayment duration permitted by the bank for such educational loans. 

However, you can repay your education loan earlier with the following process- 

  • Opting for shorter repayment periods
  • Considering transferring your study loan
  • Part repayment or prepayment 

To get a clear understanding of the educational loan EMIs, you can use the UniCreds education loan EMI calculator as well. 


Canara Bank Education Loan Subsidy 


Canara Bank offers interest subsidies for students who can’t afford to pay the loan interest amounts due to some reasons. The Government fostered these loan subsidies. These schemes include- 

  • Pradhan Mantri Uchchatar Shiksha Protsahan Yojana – Central Sector Interest Subsidy (PM-USP CSIS)
  • The Ministry of Social Justice and Empowerment launched the Dr Ambedkar Central Sector Scheme of Interest Subsidy (ACSIS) for OBCs and EBCs (under SHREYAS). 
  • Padho Pardesh Scheme offers interest subsidies on education loans for overseas studies for students from minority communities. The Ministry of Minority Affairs launched this scheme.

Hope this blog helped you get the in-depth details about the education loan offerings of Canara Bank. There is a reason education loans are rejected because of an inability to understand the nitty-gritty of the different types of education loans. You will find that each education loan factor varies depending on the bank that you are borrowing from. Hence it’s important to go through everything carefully before you make the final decision.




Q.1) What is Canara Bank education loan Vidyasagar Scheme?

Ans- The Vidya Sagar loan scheme offers financial assistance for education loans for studies in India and abroad.

Q.2) What is the validity of Canara Bank education loan sanction letter?

Ans-The validity of Canara Bank Education Loan sanction letter is 6 months. 

Q.3) What Canara Bank education loan scheme is relevant for abroad studies only?

Ans- IBA model education loan scheme and Vidya Sagar Education loan scheme are the loan schemes offered by Canara Bank to study abroad. 

Q.4) Does Canara Bank offer lower interest rates for girls in India? 

Ans- Yes, Canara Bank offers a lower interest rate for female students in India. Interest Rate of Canara Bank Education Loan for Studies in India and abroad; Up to 4 Lakhs is 11.35% and for girls 10.85%. 

Q.5) What is the moratorium period when availing of a loan under the IBA skill loan scheme?

Ans- For courses up to Rs.1 year, the moratorium is six months while for courses above one year is 12 months. 

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Canara Bank Education Loan in 2024: Interest Rates & Eligibility [Detailed Guide]

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