5 Best Education Loans in India: Complete 2024 Guide!

About Best Education Loans in India

Are you struggling to finance your education? Don't let it dim your future! We've curated a guide where we will compare the top education loans in India for 2024, catering to diverse needs. Whether you're a student aiming for a degree, a professional seeking upskilling, or considering part-time studies, this guide empowers you to find the perfect loan and fuel your educational journey. Let's unlock your academic potential, together.

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Eligibility Criteria for an Education Loan

1. Age requirement: Typically between 18 and 35 years old, although some lenders may extend the upper limit for specific courses (e.g., M.Tech, Ph.D.).
2. Academic qualifications: Minimum marks required in previous exams vary by lender and course type (e.g., 50% or above in Class 12th for undergraduate programs, 60% or above for postgraduate programs).
3. Course and institution type: Eligibility criteria may differ based on the chosen course (e.g., professional vs. non-professional) and the institution (recognized university vs. private institute).
4. Co-applicant requirement: Some lenders may require a co-applicant (parent, guardian) with a strong credit history, especially for loans exceeding a certain amount.

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List of Documents Required for Education Loan

Mandatory documents:

1. Admission letter from the chosen institution (original and copy)
2. Mark sheets of previous examinations (Class 10th, 12th, and relevant entrance exams)
3. Photo identity proofs (Aadhaar card, PAN card, passport) for the applicant and co-applicant (if applicable)
4. Proof of residence (electricity bill, ration card)

Additional documents (may vary by lender):

1. A sanction letter from the institute mentioning the fee structure
2. Income tax return (ITR) statements of the applicant and co-applicant (if applicable)
3. Salary slips of the co-applicant (if applicable)
4. Online document submission: Many lenders, like Propelld, and BankBazaar, allow online document submission for a faster and more convenient application process.

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Click here for Higher Chances of Approval than Banks - Propelld Education Loan

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Expenses Covered under Education Loans in India

1. Tuition fees: The primary expense covered by most education loans.
2. Hostel fees: Accommodation charges at the college or university.
3. Examination fees: Registration and exam fees associated with your chosen program.
4. Library fees and lab fees: Additional charges levied by the institution.
5. Some lenders may offer additional coverage: This could include living expenses, laptop/book purchases, or travel expenses.

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Advantages of an Education Loan in India

1. Pursue higher education: Bridge the financial gap and access desired educational opportunities.
2. Build credit history: Timely loan repayments can positively impact your credit score, benefiting future loan applications.
3. Tax benefits: Claim a tax deduction on the interest paid on your education loan under Section 80E of the Income Tax Act.
4. Flexible repayment options: Many lenders offer a moratorium period during your studies and various repayment options to suit your financial situation after graduation.
5. Scholarships and grants: Explore scholarships and grants offered by the government, educational institutions, or private organizations to potentially reduce your loan burden.

Now that we've covered the basics, let's dive into who exactly is offering these loans and what makes them stand out.

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Which Bank is Best for Education Loan with Low Interest Rate

Axis Bank Education Loan:

When navigating through the options for the best education loan in India, Axis Bank stands out for its comprehensive and accessible offerings. Here's why Axis Bank might be your go-to choice for financing your higher education dreams:

1. Interest Rates: Competitive rates range from 13.70% to 15.20%, making it an attractive option for students looking for an affordable way to fund their education.
2. Maximum Loan Amount: Offers up to Rs.40 lakh without the need for security, catering to a wide range of financial needs for both domestic and international education.
3. Margin: There is no margin for loans up to Rs.4 lakh, easing the initial financial burden on students and families.
4. Processing Fee: A welcoming NIL for loans up to Rs.10 lakh, reducing the upfront costs of obtaining the loan.
5. Collateral: Not required for loans up to Rs.40 lakh, making higher education more accessible to students who might not have the assets for collateral.
6. Tax Benefit: Borrowers can avail of tax benefits under section 80(E), which allows deductions on the interest paid, enhancing the loan's affordability over time.

*Remember, comparing loan options from various banks is crucial to finding the best fit for your individual needs. Consider factors like interest rates, loan amount eligibility, repayment flexibility, and any additional benefits offered before making your final decision.

Kotak Mahindra Bank Education Loan: 

Addressing the high cost of education in India, Kotak Mahindra Bank offers a feature-rich education loan that caters to students pursuing higher studies both domestically and internationally.

Here's a quick overview of the key features of this loan program:

1. Interest Rates: Starting from 12.75% and can go up to 16.00%, depending on various factors like your profile, course, and chosen loan variant.
2. Maximum Loan Amount: Avail loans up to Rs.45 lakh without the need for collateral for studies in India. For foreign education, the maximum limit can be even higher, subject to eligibility criteria.
3. Maximum Loan Tenure: Extend your repayment period for up to 15 years, allowing you to manage your finances comfortably after your studies.
4. Processing Fee: Expect a processing fee of up to 1.5% of the loan amount plus applicable taxes, which will be added to the overall loan amount.

State Bank of India Education Loan:

When scouting for the best education loan in India, the State Bank of India (SBI) sets a high benchmark with its student-friendly loan offerings. Catering to a wide spectrum of educational aspirations, SBI's education loan scheme ensures financial barriers do not hold back potential scholars. It is the best education loan in India without collateral. Here's a breakdown of what makes SBI's education loan a top contender in 2024:

1. Interest Rates: SBI offers an enticing starting interest rate of 6.70%, one of the lowest in the market. This competitive rate makes it an attractive option for students seeking an affordable financing solution for their higher education.
2. Maximum Loan Tenure: The bank extends a flexible repayment period of up to 15 years, providing students with a comfortable time frame to repay the loan post-graduation, easing the financial stress during their studies.
3. Processing Fee: To reduce the initial financial burden on students and families, SBI waives the processing fee for loans up to Rs.20 lakh, making the loan more accessible.
4. Margin: For loans up to Rs.4 lakh, SBI requires no margin, which means students can finance their entire education cost without needing to provide a percentage of the cost upfront.
5. Collateral: Understanding the challenges of arranging collateral for a loan, SBI offers loans up to Rs.7.5 lakh without the need for any security, opening doors for many students who might not have the means for collateral.

Punjab National Bank Education Loan:

Punjab National Bank (PNB) shines in the realm of education loans, offering competitive packages that make it a strong candidate for the best education loan in India. Here's a snapshot of what PNB brings to the table:

1. Interest Rates: Starting at an appealing rate of 7.15%, PNB ensures that students can access loans at competitive rates, making higher education more attainable without the burden of high-interest costs.
2. Margin: For loans up to Rs.4 lakh, especially for domestic courses, PNB offers the benefit of zero margin. This means that students can finance their education without needing to contribute any amount from their own funds for this loan segment.
3. Maximum Loan Tenure: PNB offers a generous repayment period of up to 15 years, allowing borrowers ample time to manage their finances and repay the loan comfortably after completing their education.
4. Collateral: Understanding the challenges that come with arranging collateral, PNB provides loans up to Rs.7.5 lakh without requiring any collateral. This feature is especially beneficial for students who may not have the assets to secure their loans.

ICICI Bank Education Loan: 

ICICI Bank, a leading Indian financial institution, offers a comprehensive education loan program designed to empower students to pursue their educational aspirations. Let's delve into the key features of this loan and see if it aligns with your needs:

• Interest Rates: Starting at 10.50%, ICICI Bank's education loans are structured to be as inclusive as possible, balancing affordability with comprehensive coverage.
• Maximum Loan Amount: For students eyeing overseas education, the bank generously offers up to Rs.1 crore, catering to a wide array of courses and universities.
• Margin: Recognizing excellence, ICICI imposes no margin for students admitted to premier institutions, easing the financial load significantly.

Maximum Loan Tenure: With a tenure of up to 12 years plus a grace period of six months post-completion of studies, borrowers are given ample time to repay, minimizing immediate financial pressures.

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Compare Top Education Loans in India

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It's important to note that the interest rates mentioned are indicative and may vary depending on your individual circumstances. Always refer to the official website or contact the bank directly for the latest information.

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Invest in your future, with ease.

Choosing the right education loan provider is crucial for a smooth and stress-free financing journey. By comparing lenders, interest rates, and repayment options, you can secure the best financial support for your academic goals.

Propelld's innovative platform offers a streamlined and swift alternative to traditional loan processes, empowering students to focus on their studies, not financial burdens.

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Propelld: Streamlining your Education Loan Journey

Students in India often face challenges when securing traditional education loans, including:

• Lack of credit history: Many young students haven't had the opportunity to build a credit history, making them ineligible for loans from conventional lenders.
• Cumbersome procedures: Traditional loan applications can involve complex paperwork and lengthy processing times, causing delays and frustration.
• Delayed approvals: The wait for loan approval can be stressful, especially for students needing funds to secure admission or pay tuition fees on time.

Propelld offers a refreshing alternative with its 100% digital and streamlined education loan process, designed to address these very concerns:

1. Effortless Application: Begin your journey in seconds! Simply visit Propelld's Apply for loan page: Propelld and register. The online portal guides you through the process, allowing you to track your application 24/7.
2. Eligibility Assessment: Review your eligibility comprehensively by submitting the required documents. These typically include academic transcripts, ID proofs, enrollment confirmation from your institution, and other relevant documents listed on the Propelld application form.
3. Faster Approvals: Propelld utilizes advanced technology for a swift credit check and verification process, significantly reducing waiting times compared to traditional lenders.
4. Transparent Agreements: Once your application is verified and you've carefully reviewed the loan terms and conditions, you can securely sign the agreement using Propelld's secure digital signature system.
5. Rapid Approval and Disbursement: After completing the process, you'll receive a quick update on your loan approval status. Upon approval, Propelld expedites the disbursement of funds, enabling you to focus on your educational goals with financial security.

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Propelld: Your Education Loan Partner

Don't let financial hurdles hold you back from achieving your academic aspirations. Explore Propelld's innovative approach to education loans and embrace a smoother, faster, and more accessible path to your educational dreams.

FAQs on Best Education Loans in India

What is the maximum loan repayment period for education loans in India?

The maximum loan repayment period in India can extend up to 15 years, allowing you ample time to manage your repayments comfortably. This eases the financial burden, especially for high-value loans pursuing professional degrees like medicine or engineering.

Can I get an education loan without collateral?

Yes, several lenders offer education loans without requiring collateral, particularly for loans covering domestic studies and lower loan amounts. This makes education more accessible for students from families with limited financial resources. However, interest rates for such loans might be slightly higher than secured loans.

What is the moratorium period, and how does it benefit me?

The moratorium period is a grace period offered by lenders, typically lasting 6 months to 1 year after completing your studies. During this period, you are not obligated to make any repayments on the loan principal, allowing you to focus on finding employment and establishing your financial footing before starting your EMIs.

Are there any prepayment penalties on education loans?

Fortunately, most banks in India do not levy prepayment penalties on education loans. This means you can pay off your loan entirely at any time without incurring any additional charges, offering you greater flexibility in managing your finances.

Do female applicants receive any concessions on education loans?

Several banks and NBFCs (Non-Banking Financial Companies) offer concessionary interest rates on education loans specifically for female students. This aims to bridge the gender gap in higher education by making it more affordable for women to pursue professional degrees.

Can I avail of tax benefits on education loan repayments?

Yes, the Indian government offers tax benefits under Section 80E of the Income Tax Act. You can claim tax deductions on the interest portion of your education loan repayments, reducing your overall tax liability and providing significant financial relief during the repayment period.