Federal Bank Education Loan: Interest Rates and Application

Federal Bank Education Loan 

Federal Bank is a leading private sector bank in India that offers a variety of education loan options, including competitive interest rates and flexible repayment options, which ensure that financial barriers do not stand in the way of your educational aspirations.

This article will help you explore the comprehensive benefits of a Federal Bank Education Loan and discover how it can be the foundation of your academic success.

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Federal Bank Education Loan: Key Highlights

Here is a list of the important topics covered in the blog.

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Benefits of Federal Bank Education Loans

One of the standout features of Federal Bank’s Education Loans is the flexibility in repayment options. These loans provide you with the necessary funds to achieve your academic goals. 

Here are some of the key benefits of opting for a Federal Bank Education Loan.

1. Online Application: Convenient online application process with minimal paperwork for a seamless experience.
2. Quick Disbursement: An efficient and streamlined application process ensures fast approval and disbursement of funds.
3. Collateral-Free Loans: Provides loans up to 4 lakhs without the need for security, making it accessible for a broader range of students.
4. Dedicated Support: Offers personalised assistance throughout the loan tenure, ensuring a smooth and hassle-free experience.
5. No processing fees: You don't have to pay any upfront fees to apply for a Federal Bank education loan
6. Moratorium Period: Includes a grace period post-graduation before repayment begins, giving you time to secure employment.
7. Flexible Repayment Options: Provides multiple repayment plans, allowing you to choose a schedule that suits your financial situation.

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Types and Interest Rates of Federal Bank Education Loans

Federal Bank understands that each student's educational journey is unique, and caters to their financial needs by offering a range of education loan options at different stages of their academic and professional careers.  

Federal Bank offers three different education loan options to suit the needs of different students. Have a look.

Special Vidya Loan

Available for students pursuing professional or technical courses in India or abroad (excluding vocational and skill development courses). The maximum loan amount is up to INR 10 lakhs for studies in India and up to INR 20 lakhs for studies abroad.

Fed Scholars Loan

Designed for students admitted to top universities in India or abroad. This loan offers up to INR 20 lakhs without requiring collateral security.

Federal Career Solutions Loan

Tailored for students seeking support for career-oriented education, providing comprehensive financial assistance to help achieve professional goals.

Here’s a table highlighting the three types of Federal Bank Education Loans and their specific features.

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Fed Scholars Loan Scheme: Top Institutes

If you are opting for the Fed Scholars Loan to pursue your higher education in India you must get admission into a regular course in one of the top institutions. The list of institutions eligible under the Fed Scholars Loan scheme is as follows.

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Now that you understand the different types of education loans offered by the Federal Bank, the next step is to know the eligibility criteria.

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Eligibility Requirements for Federal Bank Education Loan 

To be eligible for a Federal Bank education loan, you must meet the following requirements.

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Documents Required for Federal Bank Education Loan

Here’s a list of important documents required for the loan application process.

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Minimal Documentation. Higher Chances of Approval. Easy Online Processes. Check Your Eligibility. 

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How to Apply for Federal Bank Education Loan?

Applying for a Federal Bank Education Loan is a simple and hassle-free process designed to provide you with the financial support you need to pursue higher studies. 

You can follow the below mentioned steps to apply for a Federal Bank Education Loan.

1. Choose Your Application Method

Apply online via the official Federal Bank website or visit any Federal Bank branch. Alternatively, apply through the Vidya Lakshmi Portal.

2. Download and Fill the Application Form

Navigate to the SME Loans Applications and Agreements section under Forms and Stationery on the website. Download the PDF application form and fill it out with the required information.

3. Upload Required Documents

Ensure all necessary documents are uploaded as per the instructions provided.

4. Submit and Print the Application

Submit the completed form online and print a copy of the application for your records.

5. Visit Your Nearest Branch for Final Formalities

Visit your nearest Federal Bank branch to complete any remaining formalities.Also, do read about:  How to Apply for Education Loan in India- Complete Process

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‍Federal Bank Education Loans vs Other Banks

‍Choosing the right education loan can significantly impact your financial planning for higher education. Federal Bank Education Loans are known for their customer-centric approach and competitive features. Here’s a comparison of the Federal Bank Education Loans with those offered by other leading banks to help you make an informed decision.

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Federal Bank Education Loans Online EMI Calculator

The Federal Bank’s Education Loan Online Calculator helps you plan by estimating loan eligibility, EMIs, and repayment, ensuring you can focus on your studies.

Here are the steps to help you use the Federal Bank’s Education Loan Online Calculator.

1. Go to the Federal Bank’s Education Loan Online EMI Calculator page.
2. Enter the amount you wish to borrow and the duration over which you plan to repay the loan. 
3. Click on the 'Calculate' button to process the information. The calculator will display the estimated monthly instalment (EMI) and the total interest payable over the loan tenure.
4. Use this information to plan your monthly budget and ensure timely repayments.

Here’s an example calculation to give you an idea of the process.

Let's assume you're planning to take a loan of INR 10 Lakhs for a tenure of 10 years at an interest rate of 12.55%.

• Loan Amount: INR 10,00,000
• Interest Rate: 12.55%
• Loan Tenure: 10 years

After entering these details into the calculator and hitting 'Calculate,' you will receive:

• EMI: INR 14,667
• Total Interest Payable: INR 7,60,020
• Total Payment (Principal + Interest): INR 17,60,020

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Federal Bank Education Loan Repayment Process

Repaying an education loan can be a manageable and straightforward process with Federal Bank's structured and flexible repayment plans. Understanding the repayment process ensures you stay on top of your finances and fulfil your loan obligations without undue stress.

Here are the key features of the Repayment Process.

Moratorium Period

No repayments are required during the moratorium, typically up to 1 year after course completion or until you secure a job.

Repayment Tenure

Loans can be repaid over a period of up to 15 years, reducing the monthly EMI burden.

Flexible Options

Multiple repayment options, including EMIs, allow you to choose a plan that fits your financial situation.

Federal Bank's education loans offer competitive interest rates, flexible repayment options, and a variety of schemes to support your studies in India or abroad. With loans like the Special Vidya Loan and Fed Scholar Loan, Federal Bank makes financing your education easier. If collateral is a concern, Propelld offers a simplified, collateral-free loan process to ease your worries.

If securing funds for your education is worrying you, especially due to collateral requirements, Propelld is here to simplify the process for you.

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Why Propelld?

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Contact us today to discover how we can make your educational dreams a reality without financial stress.

Disclaimer: The information provided in this blog is for informational purposes only and should not be considered financial advice. Please consult with a qualified financial advisor before making any decisions about your education loan.

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FAQs About Federal Bank Education Loans

What is the Federal Bank's Special Vidya Loan?

It's an education loan offered by the Federal Bank to support higher studies in India and abroad, with loans up to INR 10 Lakhs for studies in India and up to INR 20 Lakhs abroad.

How does the Fed Scholars program differ from the Special Vidya Loan?

Fed Scholars is designed for students in select premier institutes, offering up to INR 20 Lakhs without collateral, no processing fees, and potential subsidies.

Do I need to provide collateral for Federal Bank education loans?

No collateral is required for loans up to INR 4 Lakhs in the Special Vidya Loan and up to INR 20 Lakhs in the Fed Scholars program.

What is the maximum repayment period for Federal Bank education loans? 

The maximum repayment period is the moratorium period (course duration + 1 year) plus 15 years.

Can I apply for a Federal Bank education loan online?

Yes, you can apply through the Vidya Lakshmi Portal and then contact a branch with your Application ID.

Are vocational training courses eligible for Federal Bank education loans?

No, vocational training and skill development courses are not eligible under the Special Vidya Loan scheme.

What expenses does the Federal Bank education loan cover? 

It covers tuition fees, hostel charges, exam fees, books, equipment, uniforms, travel expenses, and more.

Is there a list of eligible institutions for the Fed Scholars program?

Yes, there is a list of 50 premier institutions, including IITs, IIMs, AIIMS, and other top medical and management institutes.

Can I get reimbursement for expenses I've already paid?

Under the Fed Scholars program, reimbursement of expenses incurred during the current academic year can be considered.

What documents do I need to apply for a Federal Bank education loan?

You'll need proof of identity, address proof, admission letter, mark sheets, and proof of fee structure.

Is there a moratorium period for Federal Bank education loans?

Yes, the moratorium period is the course duration plus one year.

Can non-Indian citizens apply for Federal Bank education loans?

No, these loans are only available to Indian nationals.

What is the Federal Bank Education Loan interest rate?

The interest rate for Federal Bank Education Loans starts at 12.55% (Repo Rate + 6.05%). This competitive rate helps make higher education more affordable for students.

Is there a processing fee for Federal Bank education loans?

While it's not specified for the Special Vidya Loan, there are no processing fees for the Fed Scholars program.

Can I prepay my Federal Bank education loan?

The prepayment policy is not specified in the provided information. It's best to check with the bank directly.

Do I need a co-applicant for my Federal Bank education loan?

For the Fed Scholars program, a spouse, parent, guardian, or close relative should join as a joint borrower or guarantor. For the Special Vidya Loan, this information is not specified.