If you're deciding between SBI (State Bank of India) and BOB (Bank of Baroda) for an education loan, here's a quick breakdown:
SBI suits students needing higher loan amounts or broader course coverage, while BOB is better for those attending premier institutions with zero margin money. Choose based on your institution, loan size, and repayment preferences.
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SBI vs BOB Education Loan: Highlights
When deciding between SBI and BOB education loans, it's important to understand the key differences to make an informed choice. Both banks adhere to the RBI's External Benchmark Lending Rate (EBLR), but their loan structures differ significantly across various parameters.
For instance, SBI's Global Ed-Vantage Scheme allows for higher loan amounts, while BOB provides tailored benefits for students attending premier institutions. Factors like your gender, the institution you're targeting, and your funding needs can influence the best option for you.
Here's a quick comparison of the key features:
For students who need quicker processing or assistance with documentation, services like Propelld's education loan program can help streamline the process and coordinate with bank officials.
In the next section, we’ll dive deeper into the specific interest rates and loan amounts offered by each bank.
Comprehensive Comparison of SBI and BOB Education Loan Schemes
When planning to fund higher education, choosing the right bank for an education loan is crucial. State Bank of India (SBI) and Bank of Baroda (BOB) are two leading public sector lenders offering competitive education loan schemes tailored to different needs, whether you aim to study domestically or abroad. This comparison will guide you through their interest rates, eligibility criteria, loan coverage, collateral requirements, processing fees, repayment terms, and required documentation to help you make a well-informed decision aligned with your academic and financial goals.
Interest Rates Comparison
When choosing between SBI and BOB for education loans, understanding their interest rates and loan limits is essential. Both banks align their rates with RBI guidelines and external benchmarks, but their pricing and schemes differ significantly.
SBI links its education loan rates to the External Benchmark Rate (EBR), which is 8.65% as of 15 June 2025. Meanwhile, BOB uses the Baroda Repo Linked Lending Rate (BRLLR), currently at 8.15% as of 7 June 2025.
SBI Interest Rate Structure
SBI offers a variety of schemes tailored to different needs:
SBI Student Loan Scheme:
- 10.15% for unsecured loans up to ₹7.50 lakh.
- 9.15% for secured loans above ₹7.50 lakh.
SBI Global Ed-Vantage Scheme:
- 9.15% for unsecured loans in the range of ₹7.50 lakh to ₹50 lakh.
- 8.65% for secured loans from ₹7.50 lakh to ₹3 crore.
Additionally, female students enjoy a 0.50% concession across key schemes, reducing the rate for unsecured loans to 9.65% under the Student Loan Scheme.
BOB Interest Rate Structure
BOB structures its rates differently, offering competitive options:
Baroda Scholar Scheme (for premier institutions abroad):
- 8.70% for international studies.
- For non-premier institutions, rates range from 10.15% (up to ₹7.50 lakh) to 9.20% (above ₹7.50 lakh).
Baroda Gyan Scheme (for domestic studies):
- 10.15% for loans up to ₹7.50 lakh.
- 10.05% for larger amounts.
Female applicants benefit from concessions too: 0.50% for domestic loans and 0.20% for non-premier schemes abroad. For premier Indian institutions, rates vary by ranking:
- 7.10% for Top 10 IIMs/IITs.
- 7.45% for AA-rated institutions.
- 7.65% for A-rated institutions.
Maximum Loan Amounts Details
When it comes to maximum loan amounts, SBI's Global Ed-Vantage Scheme stands out, offering up to ₹3 crore for international education - the highest among public sector banks. In comparison, BOB caps its loans at ₹1.50 crore for study abroad and ₹1.25 crore for domestic education. However, BOB provides 100% funding for premier institutions, eliminating the need for margin money.
For students pursuing costly MBA programs, SBI's higher loan limits provide broader financial coverage. On the other hand, if you're aiming for premier institutions with relatively lower fees, BOB's zero margin money requirement could make their schemes more appealing.
These differences in interest rates and loan amounts can significantly impact your decision. The next step is to dive into the eligibility criteria to ensure you qualify for the best option.
Eligibility Criteria for Education Loan Schemes
Both SBI and BOB have set clear eligibility requirements for their education loan schemes. Knowing these criteria can help you decide which bank better supports your academic aspirations.
- SBI offers loans to Indian nationals and NRIs.
- For PIOs and OCIs, SBI provides loans only for studies within India.
- BOB offers loans to Indian nationals admitted to top institutions in India.
- Both SBI and BOB require students to have secured admission to a recognized university or institution.
Additionally, both banks mandate a co-applicant - usually a parent, guardian, or close relative - who must furnish proof of identity, address, and income.
Academic Course Coverage
The two banks differ in how they handle course and institution eligibility. SBI provides loans for a wide range of courses, including graduation, post-graduation, and diploma programs approved by UGC, AICTE, IMC, or other government bodies.
On the other hand, BOB focuses on full-time regular courses at premier institutions. These institutions are categorised into performance-based lists (Lists AA, A, B, and C), which influence loan amounts and benefits.
For students aiming to study at premier institutions like IITs or IIMs, both banks offer strong support. However, if you're considering specialised courses like pilot training or shipping, SBI's broader course coverage might be a better fit. For international studies, it’s essential to check whether your chosen university aligns with BOB’s premier institution list or meets SBI’s criteria.
Understanding these eligibility guidelines is a key step as you explore other important factors like course coverage and collateral requirements in the following sections.
Loan Coverage, Collateral, and Margin Money
When deciding between SBI and BOB education loans, it’s essential to understand how much funding you’ll receive and the security you’ll need to provide. Both banks differ in their coverage percentages and collateral requirements, which can significantly influence your borrowing experience. Let’s break down the details of funding, collateral, and margin money for each.
SBI covers up to 90% of education expenses with a fixed 10% margin. So, if your course costs ₹20 lakh, you’ll need to contribute ₹2 lakh as margin money. For loans up to ₹7.5 lakh, no collateral is required. However, for amounts exceeding ₹7.5 lakh, collateral becomes mandatory.
SBI also offers the Global Ed-Vantage scheme, which extends collateral-free loans up to ₹50 lakh for select premier institutions abroad.
"SBI's Global Ed-Vantage initiative offers up to ₹50 lakh as a collateral-free loan with repayment flexibility of up to 15 years, ensuring greater accessibility for Indian students." - Saurabh Arora, Founder and CEO of University Living
BOB’s premier institution benefit stands out - students at top-ranked colleges can avoid margin money entirely, which is a relief for costly courses.
For those aiming to study abroad, SBI’s Global Ed-Vantage scheme provides substantial collateral-free funding, though it’s restricted to select institutions. Meanwhile, BOB’s policy is more favourable for students attending premier domestic institutions, offering full funding without requiring margin money.
Ultimately, your choice should depend on your institution’s ranking and the overall cost of your course. If you’re heading to a premier institution, BOB’s zero margin money policy could ease your financial burden more than SBI’s fixed 10% margin. Next, let’s dive into the processing fees and timelines to complete the picture.
Processing Fees
When applying for an education loan, it's crucial to factor in processing fees to manage your budget effectively. Both SBI and BOB impose processing fees, but their structures are quite distinct.
SBI charges a flat ₹10,000 + GST, which is non-refundable. If your application is rejected, this amount is not returned. Additionally, SBI does not explicitly mention any extra charges for collateral evaluation in its standard fee structure.
BOB, however, charges ₹10,000 + GST as a refundable processing fee, along with an additional ₹7,500 for property evaluation if collateral is involved. This property evaluation fee applies regardless of the loan's approval status.
Interestingly, under BOB's 'Baroda Scholar' scheme, the processing fee is completely waived. However, the ₹7,500 property evaluation charge still applies if you're providing collateral.
Up next, we'll dive into repayment terms to help you complete your evaluation.
Repayment Terms and Moratorium
Repayment terms shape your financial responsibilities after graduation. Both SBI and BOB provide structured repayment options, but their features differ slightly. Let’s break down how these two banks handle repayment and moratorium benefits.
SBI offers an extended moratorium period, covering the full course duration plus an additional grace period. For its regular education loans, repayment kicks in either one year after completing the course or six months after getting a job - whichever comes first. The SBI Shaurya Education Loan, however, extends the moratorium to include the course duration plus 12 months, giving borrowers more breathing room to settle into their careers. During this time, any interest accrued is added to the principal and repaid through EMIs.
BOB provides a moratorium period that spans the course duration plus an additional 6 to 12 months, depending on the loan type and academic programme.
One key benefit of SBI loans is the option to pay the full interest during the moratorium period. By doing so, you avoid interest being added to the principal, which can lead to lower EMIs later on.
Both banks allow a repayment tenure of up to 15 years, offering flexibility through step-up EMI options and bullet payments to align with your income growth.
Required Documents
Getting your documentation right is a key step in speeding up your education loan approval. Both SBI (State Bank of India) and BOB (Bank of Baroda) have their own sets of requirements, which slightly differ depending on the category. Knowing these details ahead of time can help you avoid delays.
The documents are grouped into three main categories: student documents, co-applicant documents, and collateral documents. While both banks follow RBI guidelines, their formats and specific needs vary.
Student Documentation Requirements
Your academic records form the backbone of your application. Here's how the two banks differ in their requirements:
In addition, SBI requires passport-size photographs, account statements, and an expense statement, while BOB asks for a college prospectus and two passport-size photos. If there's a gap in your education, SBI also requires a self-declared gap certificate.
Co-Applicant Documentation
The co-applicant's financial details are crucial for loan approval, and the requirements differ based on their employment type.
For salaried co-applicants:
- SBI: Salary slips for the last 3 months, Form 16 for the last 2 years, and salary account statements for 6 months.
- BOB: Salary slips or certificates, Form 16, and IT returns acknowledged by the income tax department.
For self-employed co-applicants:
- Both banks require business address proof, IT returns for the last 2 years, and TDS certificates (Form 16A).
- SBI additionally asks for a brief statement of assets and liabilities of the co-borrower.
SBI also requires an affidavit to confirm the relationship between the applicant and co-applicant, along with a cancelled cheque or the front page of a passbook. If you're transferring a loan from another lender, SBI will need the loan account statement for the past year.
Collateral and Additional Documentation
For loans that exceed the collateral-free limit, you'll need to provide property-related documentation, such as property papers, valuation reports, and legal verification documents.
BOB makes it mandatory to submit a passport as address proof for study abroad applications, whereas for SBI, this is optional.
To avoid missing anything, you can refer to Propelld's student eligibility checklist and double-check your documents before applying to either bank.
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Education Loan for Abroad Studies
Pursuing education abroad often requires tailored financial support to manage unique expenses. With over 1.3 million Indian students studying overseas in 2023, understanding how banks like SBI and Bank of Baroda cater to these needs becomes crucial. Both institutions provide education loans for international studies, but their offerings differ in ways that can impact your study abroad plans. Here's a closer look at how they handle visa fees, forex services, and other essential support.
Visa Fee Coverage and Forex Services
SBI's Global Ed-Vantage programme covers key costs like visa fees and embassy documentation and offers collateral-free loans up to ₹50 lakh to ease student financial burden. Bank of Baroda’s Baroda Scholar scheme similarly includes visa fee coverage. Both banks also provide forex services, simplifying international transactions and currency exchange for students studying abroad.
Embassy Documentation and Pre-Departure Support
SBI provides pre-visa disbursement to cover tuition and accommodation, ensuring financial support before departure. Bank of Baroda has a dedicated study abroad desk to assist with visa documents and university coordination. Both banks offer financial planning advice and recommend starting preparations, including travel and accommodation arrangements, at least a month in advance for a smooth transition.
Additional Support Services
Bank of Baroda goes a step further by leveraging its alumni network to connect new students with current university attendees. This helps students settle into their new environment more comfortably. They also guide students in exploring scholarships, grants, and other financial aid options offered by educational institutions or external organisations.
Choosing between SBI and Bank of Baroda for an education loan depends on your specific academic and financial needs. SBI offers a slight interest rate benefit for female applicants (9.65% vs. Bank of Baroda’s 9.70%) and has a predictable 10% margin money requirement for all. Bank of Baroda, however, has an edge if your institution is on its premier list, offering lower or no margin money and competitive interest rates for male applicants. This can make it more appealing for some borrowers.
SBI generally processes loans more quickly (within 3 weeks), while Bank of Baroda may experience delays due to collateral valuation. However, Bank of Baroda offers a longer repayment relief period with a course duration plus 12 months moratorium. In the end, your choice should be based on your institution’s eligibility, course duration, and how each bank’s terms align with your financial planning. For quicker approvals and no-collateral loan options, checking Propelld’s eligibility checklist can also be a good step.
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