Pursuing higher education is a dream for many, but the rising tuition and living expenses can be a significant hurdle. Thankfully, AU Small Finance Bank Education Loan is here to help you bridge the gap. Whether you're looking to study in India or abroad, this education loan could be the financial support you need to turn your academic aspirations into reality.
In this blog, we'll guide you through everything you need to know about the AU Small Finance Bank Education Loan.
Let's dive in!
Why Choose AU Small Finance Bank Education Loan?
When looking for an education loan, you’ll want a reliable, transparent bank that offers competitive interest rates. Here's why the AU Small Finance Bank Education Loan stands out.
1. Flexible Repayment Terms
Repay your loan over 5 to 15 years with no penalties for early repayment.
2. Interest Rate Benefits
Enjoy competitive rates based on your academic profile and the institution you’ve been admitted to.
3. Tax Benefits
Claim tax deductions on interest payments under Section 80E of the Income Tax Act.
4. Loans for Domestic & International Education
AU Small Finance Bank has you covered whether you're studying in India or abroad.
One key reason students prefer AU Small Finance Bank is repayment ease, especially during the education loan moratorium period, which allows borrowers time before starting EMI payments.
Also Read SBI Education Loan for MBBS Students: Eligibility & Process.
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Key Features of AU Small Finance Bank Education Loan
Let’s take a look at the key features that make the AU Small Finance Bank Education Loan a solid choice for students:
| Feature | Details |
|---|---|
| Loan Amount | Up to ₹20 lakh for domestic studies; higher limits for international studies depending on the course and institution. |
| Eligibility | Must be an Indian citizen with confirmed admission to a recognised institution. |
| Co-applicant Requirement | A co-applicant, usually a parent or guardian, with a stable income and good credit profile is required. |
| Interest Rate | Ranges from 9% to 13% depending on the course, institution, and co-applicant’s creditworthiness. |
| Repayment Tenure | 5 to 15 years with a grace period (moratorium) of up to 12 months post-completion of the course. |
| Processing Fees | 1-2% of the loan amount as a processing fee. |
| Prepayment Charges | There are no prepayment penalties, so you can repay early without incurring extra costs. |
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Eligibility Criteria for AU Small Finance Bank Education Loan
Before applying for an AU Small Finance Bank Education Loan, it’s essential to ensure you meet the bank’s eligibility requirements. Here’s a breakdown of what you need to qualify.
| Criteria | Details |
|---|---|
| Nationality | Must be an Indian citizen. |
| Age | Between 18-35 years old. |
| Admission | Admission to a recognised institution in India or abroad is required. |
| Co-applicant | A stable income co-applicant, usually a parent or guardian, is mandatory. |
| Academic Profile | Strong academic performance may qualify you for a lower interest rate. |
These criteria ensure that you and your co-applicant are financially stable and ready to repay the loan.
Also read Auxilo Education Loan 2024: Interest Rates and How to Apply.
AU Small Finance Bank Education Loan: Documents Required
To apply for an AU Small Finance Bank Education Loan, you’ll need to submit the following documents:
1. Proof of Identity
Aadhaar card, passport, or voter ID.
2. Proof of Admission
Admission letter from your university or institution.
3. Academic Records
Mark sheets and certificates from previous qualifications.
4. Income Proof
Salary slips or IT returns of the co-applicant.
5. Bank Statements
Latest six months’ bank statements of the co-applicant.
6. Loan Application Form
Fully filled and signed by both the student and the co-applicant.
These documents help the bank assess your eligibility and determine the terms of your loan.
Minimal Documentation. Higher Chances of Approval. Easy Online Processes. Check Your Eligibility.
Interest Rates on AU Bank Education Loan
Interest rates play a crucial role when deciding on a loan. The AU Bank education loan interest rate varies based on factors like the type of course, the institution, and the creditworthiness of your co-applicant. Let’s break down the interest rate structure
| Category | Interest Rate | Factors |
|---|---|---|
| Domestic Education Loan | 9% - 12% | For undergraduate and postgraduate studies in India. Rates are lower for top-tier institutions. |
| International Education Loan | 10% - 13% | For students studying abroad. Higher interest rates may apply for lesser-known institutions. |
| Special Rate for Top Colleges | 8.5% - 9.5% | Students admitted to prestigious colleges may qualify for lower interest rates based on their academic record. |
The interest rate for your loan will largely depend on your course, academic history, and the co-applicant's financial stability. A better credit score and a more robust academic profile may help you lock in a more favorable AU Bank education loan interest rate.
Also Read Bank Of India Education Loan: Interest Rate 2024 & How to Apply.
If you're exploring financing options with AU Bank, you should also know how to get the best education loan interest rates by comparing lenders, credit scores, and repayment flexibility.
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How to Apply for AU Small Finance Bank Education Loan?
Applying for the AU Small Finance Bank Education Loan is a simple and straightforward process. Here’s how you can do it.
1. Online Application
Head to AU Bank’s official website and fill out the education loan application form.
2. Submit Documents
Upload the required documents online or visit a local branch to submit them in person.
3. Verification
The bank will verify your details and your co-applicant’s creditworthiness.
4. Approval
Once everything checks out, your loan will be approved.
5. Loan Disbursement
The loan amount will be directly transferred to the educational institution.
This process is designed to be as hassle-free as possible, so you can focus on your studies rather than stressing over the paperwork.
Loan Repayment Terms
Repaying your education loan should not become a burden. AU Bank offers flexible repayment options to ensure you’re not overwhelmed after completing your studies.
1. Moratorium Period
You get a grace period of up to 12 months post-course completion before you start repayment.
2. Loan Tenure
Depending on your financial situation, you can choose a repayment term between 5 and 15 years.
3. Monthly EMIs
Your monthly instalments are based on the loan amount, interest rate, and repayment term.
4. Prepayment Option
Want to clear your loan early? No problem. AU Bank doesn’t charge any prepayment penalties, giving you full control over your loan.
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Pros and Cons of AU Small Finance Bank Education Loan
Every loan product comes with its set of advantages and challenges. Here’s a quick look at the pros and cons of the AU Small Finance Bank Education Loan.
| Pros | Cons |
|---|---|
| Competitive interest rates starting from 9% | Higher interest rates for less reputed institutions and international courses. |
| Flexible repayment options with tenures up to 15 years | Processing fee of 1-2% adds to the overall cost of the loan. |
| No prepayment charges, allowing for early loan repayment | Limited loan amount for some courses. |
| Loans available for both domestic and international education | Stringent eligibility criteria for co-applicants with regard to credit score and income. |
| Tax benefits under Section 80E | Some students may find better deals with more extensive public sector banks. |
Understanding these pros and cons will help you make an informed decision about your education loan.
Also Read our blog, Bank of Maharashtra Education Loan: Eligibility and Interest Rates
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The AU Small Finance Bank Education Loan is a strong contender if you’re looking for financial aid to pursue higher education in India or abroad. With competitive interest rates, flexible repayment options, and tax benefits, it’s definitely worth considering. However, make sure you compare it with other banks to find the best deal for your specific needs. Also, factor in the interest rate, processing fees, and repayment options before making your decision.
Take control of your education finances with Propelld! Our student-friendly loans offer quick approvals, flexible repayments, no collateral up to 50 lakhs, and a lot more!
Why Propelld?
| Feature | Details |
|---|---|
| Max Loan Amount | 50 Lacs |
| Collateral | Not Required |
| Moratorium | Available |
| Processing Time | 10 Times Faster than Banks |
| Disbursal Time | 7 Days |
| Approval Rate | Higher than Banks |
| Special USP | Marks Based Approval |
| % Financed | 100% of Fees |
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