SBI Education Loan: Check Eligibility, Courses, Covered Expenses, Rate, Loan Amount, Repayment, EMI

SBI grants a student loan of up to Rs 10 lakh for higher education in India. | Photo credit: BCCL

New Delhi: State Bank of India (SBI), the largest bank in India by number of clients and size of assets, offers a range of credit facilities especially for aspiring higher education. Under SBI Student Loans, State Bank of India has Student Education Loans Web Platform, Student Loans Program, SBI School Loans Program, loan program for vocational education and training, a central interest subsidy and reward program of the State Bank for educational loans.

Through the SBI Student Loan Program, State Bank of India provides term loan to Indian nationals to pursue higher education in India or abroad where admission has been guaranteed. Interestingly, SBI does not take any processing fees or upfront fees on educational loans given to students.

SBI education loan: Course, expenses covered, interest rate, loan amount, repayment, EMI, margin, security deposit

Courses Covered for Graduate Studies in India:

  • Diploma, post-diploma including regular technical and vocational diploma / diploma courses offered by colleges / universities approved by UGC / AICTE / IMC / government etc.
  • Regular diploma / diploma courses provided by autonomous institutions such as IIT, IIM, etc.
  • Teacher training / Nursing courses approved by central government or state government.
  • Regular diploma / diploma courses like aeronautics, pilot training, navigation etc. approved by the Director General of Civil Aviation / Navigation / relevant regulatory authority.

Courses covered for higher studies abroad:

  • Job-oriented professional / technical graduation courses / diploma and post-diploma courses such as MCA, MBA, MS, etc. offered by reputable universities.
  • Courses provided by CIMA (Chartered Institute of Management Accountants) – London, CPA (Certified Public Accountant) in the United States, etc.

Expenses covered:

  • Fees payable to college / school / hostel in relation to exam / library / lab.
  • Purchase of books / equipment / instruments / uniforms, purchase of computers essential for course completion (maximum 20 percent of total tuition fees payable for course completion).
  • Security deposit / construction fund / refundable deposit (maximum 10 percent of tuition fees for the entire course)
  • Travel expenses / transient money for study abroad.
  • Cost of a two-wheeler up to Rs 50,000.
  • All other expenses needed to complete the course like study tours, project work, etc.

Amount of the loan: SBI grants a student loan of up to Rs 10 lakh for higher education in India and up to Rs 20 lakh for higher education abroad.

Interest rate: The State Bank of India charges an interest rate between 8.55% and 10.80% with a 0.50% concession for students benefiting from SBI Rinn Raksha or any existing policy awarded in favor form the bank. Interest rate may vary depending on credit rating, nature of course, other things as mandated by State Bank of India.

Refund: The repayment of the loan amount begins one year after the end of the course. The loan amount must be repaid within 15 years of the start of the repayment period. In case a second loan is used for graduate studies later, to pay off the combined loan amount in 15 years after the second course ends, the SBI said.

IEM: Interest accrued during the moratorium period (one year after the end of the course) and the course period is added to the principal amount and the repayment is fixed in equal monthly installments (EMI). If a person has paid interest in full before repayment begins, the EMI is set on the basis of the principal amount only.

Security deposit: For educational loans up to Rs 7.5 lakh, no collateral or third party guarantee is required, only the parent / guardian should be the co-borrower. For the loan amount exceeding Rs 7.5 lakh, a tangible material guarantee is required as well as the parent / guardian being the co-borrower.

Margin: There is no margin requirement for the loan amount up to Rs 4 lakh, while for the loan amount above Rs 4 lakh, SBI takes a margin at a rate of 5 percent for studies in India and 15 percent for study abroad.

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