There are numerous opportunities opening up for students these days across different streams that weren’t available even until a decade ago. Notwithstanding, it is usually the case that students choose to travel abroad for their higher education, to make sure that their hard work counts in the job market. Every parent desires to support what their children want to do in the future and their dreams. At times, even for those in a convenient financial situation, tuition fees at foreign universities can be exorbitant.
That’s the time when the cheapest education loan come to your rescue!
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. Though, the Interest payments 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.
Have a look at some of the cheapest education loans offered in India provided by top loan providers:
State Bank of India
SBI provides one of the cheapest education loan for abroad studies via the SBI Student loan schema. SBI provides loans for all graduate, post-graduate, and professional courses such as MS, MBA, etc. at recognized universities and is reputed in their home country.
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.
| Education Loan Schemes | Interest Rates (p.a) |
| SBI Global ED-VANTAGE | 11.15% p.a. |
| SBI Take Over of Education Loan | 8.55% p.a. – 10.05% p.a. |
| SBI Student Loan | 11.15% |
| SBI Scholar Loan | 8.55% p.a. – 10.05% p.a. |
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:
| Education Loan Schemes | Interest Rates |
| Baroda Scholar | 10.40% p.a. – 11.15% p.a. |
| Baroda Vidya | 12.50% |
| Baroda Education to Students of Premier Education | 9.15% to 10.20% |
| Baroda Gyan | 11.15% |
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.
| Education Loan Schemes | Interest Rates (p.a) |
| Cent Vidyarthi for Executive MBA | 8.80% |
| Cent Vidyarthi | 8.30% to 11.50% |
| Cent Education Loan | 8.30% to 11.25% |
| Cent Vidyarthi IIMs and other reputed management institutes | 8.30% |
| Cent Skill Loan | 11.15% to 11.20% |
Punjab National Bank
| Education Loan Schemes | Interest Rates (p.a) |
| PNB Honhaar | 11.25% |
| PNB Pravasi Shiksha Loan | 10.95% to 11.75% |
| PNB Udaan | 10.00% – 10.75% |
| PNB Kaushal | 10.25% – 10.75% |
| PNB Saraswati | 10.00% – 10.75% |
| PNB Pratibha | 8.55% – 10.50% |
Another nationalized bank known to be one of the best and preferred banks for offering the cheapest interest rates for education loans is PNB. It provides cheap education loans through its Udaan scheme. Some benefits attached to it are:
Education loans are granted for top-class universities providing professional, diploma, graduate, and post-graduate courses across different streams such as science and technology, medicine, etc. The loans cover everything ranging from tuition, exam and textbook fees to travel expenses, etc.
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. You can visit their official websites, contact their customer service, or consult with a loan advisor to get accurate information about the interest rates.
2.Are there any specific eligibility criteria to avail 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 or financial institutions may offer special benefits or schemes for certain categories of students, such as lower interest rates for female students or concessions for economically disadvantaged backgrounds.
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