Oriental Bank of Commerce Education Loan: Now PNB (Post-Merger Guide)

Education is often a pathway to a brighter future, but the cost of higher education can be a significant barrier for many. This guide covers education loans that were previously offered under Oriental Bank of Commerce and are now available through its successor, Punjab National Bank (PNB), following the merger effective 1 April 2020.

This article helps you understand the education loan options now available through PNB, including eligibility, loan features, repayment options, and other essential information you need to make an informed decision.

Important Notice: OBC Has Merged into PNB

Effective 1 April 2020, Oriental Bank of Commerce (OBC) and United Bank of India were amalgamated into Punjab National Bank (PNB) by the Government of India. OBC is no longer a separate entity. All existing OBC customers, loans, and accounts have been migrated to PNB.

Students who held or are looking for education loans previously associated with OBC must now deal with PNB. The official portal is pnbindia.in.

Overview of PNB Education Loan (Successor to OBC)

PNB's education loans are designed to provide financial support for students who wish to pursue higher education at recognised institutions in India or abroad. They cover various educational expenses like tuition fees, hostel charges, exam fees, and more.

Here is an overview of the PNB education loan scheme (indicative as of 2025-26; verify with PNB at pnbindia.in):

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PNB Education Loan Interest Rates

PNB education loans offer competitive floating interest rates. The exact rates depend on the loan scheme (PNB Saraswati or PNB Udaan), the student's profile, and the nature of the course. Rates for premier institution students may differ from standard rates.

All interest rate figures are indicative and subject to change as of 2025-26. Always verify the latest rates directly with PNB at pnbindia.in before applying.

Margin Money and Loan Amounts

Margin money refers to the contribution the student or co-applicant must make toward the total loan amount. Indicative margin money norms under PNB (verify with PNB for current thresholds):

• For loans up to ₹4 Lakhs: No margin money required
• For loans above ₹4 Lakhs: 15% for education abroad; 5% for education in India

This margin money requirement ensures that both the student and the bank share the financial responsibility of funding the education.

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Security and Collateral for PNB Education Loan

Security requirements depend on the loan amount (indicative; verify with PNB):

• For loans up to ₹7.5 Lakh: No collateral required; however, parents/guardians must be co-applicants.
• For loans above ₹7.5 Lakhs: Collateral is required, which could be in the form of immovable property (such as a house or land) or other acceptable forms of security.

Key Benefits of PNB Education Loan

Here are some key advantages of PNB education loans (successor to OBC), making them an attractive option for students:

• PNB offers competitive interest rates — verify the latest at pnbindia.in.
• Loans up to ₹7.5 Lakhs do not require collateral, easing the financial burden for students without significant assets (verify current threshold with PNB).
• Repayments begin after course completion, allowing students time to secure employment before starting repayments.
• PNB provides a moratorium period, allowing students to focus on their studies without worrying about payments.
• The loan covers a wide range of education-related expenses, including tuition, hostel fees, exam fees, travel expenses for studying abroad, and essential equipment such as laptops.
• Under Section 80E of the Income Tax Act, students can claim deductions on the interest paid on the education loan.

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How to Apply for a PNB Education Loan?

To apply for a PNB education loan (which has succeeded OBC's education loan), you have two options. You can visit a PNB branch to submit your application and documents, or apply online through pnbindia.in. Ensure eligibility, gather the necessary documents, complete the form, and submit it for processing.

You can follow these steps:

1. Ensure you meet the eligibility criteria for a PNB education loan.
2. Collect all the necessary documents as outlined below.
3. Visit the nearest PNB branch or go to pnbindia.in to fill out the education loan application form.
4. Submit the completed application form along with the necessary documents.
5. Once approved, the loan amount will be disbursed in stages, either to your educational institution or directly to you for other expenses.

Documents Required for PNB Education Loan

To streamline the application process, you will need to submit the following documents:

Documents from the Applicant:

• Photo ID proof like Passport, Voter ID, Aadhaar Card
• Proof of age via Birth certificate or Passport
• Academic transcripts
• Admission certificate
• Fee structure from the institution
• PAN card
• Proof of residence, such as a Utility bill, Aadhaar card, or Passport

Documents from the Co-Applicant:

• Photo ID proof and address proof
• Bank statements from the last 6 months
• Income proof like Salary slips, Form 16, ITR
• Collateral documents (if applicable), such as title deeds, LIC policy, etc.

A complete set of documents will help expedite the loan approval process.

Repayment Options for PNB Education Loan

For education loans — whether originally taken under OBC (now migrated to PNB) or newly taken under PNB — all repayment options are now managed by Punjab National Bank (PNB).

Here are some repayment options:

1. Standing Instruction (SI)

If you hold an account with PNB, you can set up an automatic EMI payment from your PNB account.

2. Electronic Clearing Service (ECS)

If you do not have a PNB account, you can set up ECS to have your EMIs automatically debited from your account at another bank.

3. Post-Dated Cheques (PDCs)

For non-ECS locations, you can submit post-dated cheques for your EMI payments.

It is recommended to opt for SI or ECS for smooth and hassle-free EMI payments.

Explore different Types of Education Loans with Eligibility, Interest Rates, and Benefits to understand which option best suits your needs and repayment capacity.

Comparing education loan options is key to finding the right financial support for your studies. Since OBC has merged into PNB, students should approach PNB directly for education loans under PNB Saraswati (domestic) or PNB Udaan (abroad). Whether you choose a secured or unsecured loan, focus on interest rates, repayment terms, and any applicable fees. All figures in this guide are indicative as of 2025-26 and subject to change — verify the latest at pnbindia.in.

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