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SBI Education Loan: Types, Eligibility, Interest Rates & Application Process
As important as education is, the expenses associated with it are challenging to bear for many Indian families and students. This is why SBI, a national financial powerhouse, offers students many education loan schemes to cover these expenses. SBI education loan is one of the most accessible options for students to fund and fuel their dreams of higher education.
Read on to know:
- The different types of education loans that SBI provides and their details.
- Interest rates vary from 8.05% to 11.5%. You will know the factors that affect this.
- SBI offers various different repayment options including a moratorium period and zero pre-payment penalty. Reason to know complete details about various concessions and how to best utilise them.
SBI Education Loan Schemes
SBI offers different kinds of education loans with different terms and conditions, depending on the course. The interest rates on these loans start from as low as 8.05% and loan amount can be as high as 1.5 crores.
The different education loan schemes offered by SBI are:
SBI Loan Scheme for Study Abroad
- SBI Student Loan Scheme
- SBI Global ED-VANTAGE Scheme
- SBI Shaurya Education Loan
SBI Loan Scheme for Study in India
- SBI Student Loan Scheme
- SBI Scholar Loans
- SBI Shaurya Education Loan (For Wards of Defense and Indian Coast Guard Personnel)
- SBI Skill Loan Scheme
Apart from these, there is also a takeover of education loans provided for both of the above segments.
Let’s see these schemes in detail:
1. SBI Student Loan Scheme
This loan provides financial assistance to deserving students pursuing higher education in India or abroad.
Eligible Courses
India
Graduate or post-graduate degrees, Diplomas and professional courses.
Abroad
Job-oriented professional or technical courses, post-graduate studies (MCA, MBA, MS), Ph.D. programs, and recognised diploma courses like aeronautical, pilot training.
Student Eligibility
Indian nationals and NRIs for studies at recognized institutions worldwide, while PIOs and OCIs can only avail loans for studies within India.
Eligible Expenses
- Tuition, hostel fees, exam fees, library fees, lab fees, books, equipment, travel expenses, study tours, project work, and a two-wheeler (up to Rs. 50,000), among others.
Repayment Terms
- The Repayment for the loan is initiated after the compilation of the course. Additionally, One-year moratorium or months after getting a job, whichever is earlier.
- Repayment period is of up to 15 years.
Top Up Loan
During the moratorium period of the first loan, applicants may seek an additional loan for further studies, provided they fulfill the necessary security requirements.
Application Timeline
Maximum 15 days after receiving the completed application and documents.
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2. SBI Scholar Loan Scheme
This scheme provides financial assistance for deserving students pursuing full-time courses at selected premier institutions.
For the purpose, a list of eligible institutions is available at the SBI Scholar Loan Portal.
Interest Rates
Interest rates depend on the institute category and are as follows:
Maximum Loan Amount and Security
The co-opplicant must be the parent(s) or guardian or spouse or parents or parents-in-law for married students.
Other Details
Eligible Courses
- Full-time degree or diploma programs via entrance exams or selection processes
- Full-time executive management courses like PGPX
- Graduate or postgraduate part-time programs offered by select institutions
Student Eligibility
Indian nationals, including NRIs, who secure admission through an entrance exam or selection process.
Eligible Expenses
Tuition, hostel fees, examination fees, laboratory and library fees, books, equipment, travel, caution deposits, exchange programs, and the purchase of laptops or computers.
Repayment terms
Repayment Holiday or Moratorium: The repayment period begins after the course duration plus one year, with an option to service the interest during the course and moratorium period.
Processing and Disbursement
Repayment up to 15 years post-course completion and moratorium, with an option to extend course completion by up to two years.
Top Up Loan
A second loan can be taken for further studies, subject to conditions. Combined loan repayment over a maximum of 15 years.
Application Timeline
Processing takes up to 15 days after receiving the complete application and documents, excluding delays from submissions or verifications.
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3. SBI Skill Loan Scheme
This scheme is especially designed for people looking to pursue skill development courses in India.
Interest accrued during the moratorium period is added to the principal and repaid through EMIs.
Courses and Institution Eligibility
- Courses from ITIs, polytechnics, NSDC-affiliated partners, skill councils, and state skill corporations.
- Schools recognised by the central board or state boards, and colleges affiliated with recognised universities.
- No requirement of minimum course duration.
- Courses should ideally result in a certificate, diploma, or degree under the National Skill Qualification Framework (NSQF).
Eligible Expenses
- Tuition, course, examination, library, and laboratory fees, along with caution deposits.
- Expenses for books, equipment, instruments, and other essentials required for course completion.
Application Timeline
- Within 15 days of receiving the complete application and documents.
- The timeline begins upon complete document submission and may extend by 15 working days for additional verification.
4. SBI Global Ed-Vantage Scheme
This scheme provides financial assistance to meritorious Indian students looking to pursue full time regular courses at foreign universities.
Eligible Courses
- Graduate, postgraduate, diploma, certificate, and doctoral degrees from foreign institutions in the USA, UK, Canada, Australia, Singapore, Japan, Hong Kong, New Zealand, and Europe.
- Courses in other countries may be considered on a case-by-case basis.
Eligible Expenses
- Tuition fees, examination fees, library fees, and laboratory fees.
- Travel expenses for studies abroad.
- Purchase of books, equipment, uniforms, and computers.
- Caution deposits, building funds, and refundable deposits.
- Insurance premiums for 'Rinn Raksha' policy.
- Contingency expenses up to 5% of the loan amount.
Loan Process
- Applications are submitted via the Vidya Lakshmi Portal (VLP).
- Sanction letters or admission documents may be issued prior to visa approval.
- Fee reimbursement from personal sources may be considered within six months with supporting documents.
- Loans are generally sanctioned at the branch nearest to the student's permanent address.
- Disbursements are made directly to institutions or vendors in stages.
Security
- Co-application of parents/guardians with collateral security.
- Collateral from third parties (excluding parents) is accepted.
- Security can include land, buildings, government securities, bonds, LIC policies, mutual funds, bank deposits, or other assets.
Repayment Period
- Up to 15 years after course completion and the moratorium period.
- Possible two-year extension for course completion delays.
- Unpaid interest during the moratorium is added to the principal and repaid via EMIs.
Application Timeline
- Within 15 days of receiving a complete application and documents.
- Additional 15 working days for required verifications.
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5. SBI Takeover Education Loan Scheme
This is simply put, switching your existing high-cost education loan to SBI, if you feel it offers better terms than your existing loan.
Eligibility
- The loan must be a first-time takeover
- The student-borrower must be a legal adult at the time of the switch.
- The original loan must be fully disbursed, with repayment and regular EMI payments made at the current bank or financial institution.
Here is a step by step guide on how to transfer your education loan. Do give a read.
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6. Shaurya Education Loan
The Shaurya Education Loan is available for the wards or spouses of Defence, Indian Coast Guard, and Central Armed Police personnel for studies in India and abroad.
Eligible Courses
India
- Graduate or postgraduate degrees, diplomas, courses like ICWA, CA, CFA, etc.
- Courses at institutions like IIM, IIT, IISc, NIFT, and approved foreign universities in India.
- Professional degrees or diplomas in fields like aeronautics, pilot training, shipping, etc.
Abroad
- Courses at institutions like IIM, IIT, IISc, NIFT, and approved foreign universities in India.
- Graduation, postgraduation, and Ph.D. in job-oriented courses, including CIMA (London), CPA (USA), and other recognized programs.
Eligible Expenses
- Premium for 'Rinn Raksha' insurance policy.
- Two-wheelers costing up to Rs. 50,000 require a third-party guarantee or collateral security.
- Tuition fees, examination/library/laboratory fees, books, equipment, instruments, uniforms, and computers.
- Additional course expenses include study tours, project work, and thesis
- Travel expenses for studies abroad.
Loan Process
- Loans are sanctioned at the co-borrower's residence, workplace, or property location.
- Disbursement is staged as needed and sent directly to institutions or vendors.
- Reimbursement of fees paid from own sources is possible within six months of payment, with proof.
Security
Study in India
- Up to Rs. 7.5 lakh: Nil.
- Above Rs. 7.5 lakh to Rs. 40 lakh: Optional security.
- For secured loans: 100% liquid collateral or 110% property collateral.
Study in Abroad
- Up to Rs. 7.5 lakh: Nil.
- Above Rs. 7.5 lakh: Optional security, similar to India loans.
- An Equitable Mortgage (EM) must be created within six months of sanction; a penalty applies for delays.
- The student and parent must sign as joint borrowers, with the parent holding a Diamond/Platinum DSP/ICGSP account.
Repayment Period
- Up to 15 years after course completion and moratorium.
- Extension of course duration by up to two years may be permitted.
- Unpaid interest during the course and moratorium is added to the principal for EMI calculation.
Application Timeline
- Processing is completed within 15 days of receiving the full application and documents.
- Timelines count only full working days; an additional 15 working days may apply for verification with authorities.
SBI Education Loan for MBBS
While SBI education loan is available for a plethora of courses as discussed above, it has different specifications for MBBS vs other courses.
Maximum Loan Limits
For Studies in India
For Studies Abroad
Up to ₹7.50 lakh (Higher loan limit for Studies abroad are considered under Global Ed-vantage Scheme, maximum up to ₹ 3.00 Crores).
All other details as per the loan types discussed above.
Also know the complete details on how to get an education loan for abroad studies.
Advantages of SBI Education Loan
The State Bank of India (SBI) offers a range of education loans that cater to the diverse needs of students pursuing higher education in India and abroad. The advantages of SBI Education Loans include:
1. Low Interest Rates
The education loan interest rate SBI bank offers is competitive with other lenders, with the lowest rate being 10.25% as of May 1, 2024.
2. Higher Loan Amounts
SBI Education Loans offer higher loan amounts, with the maximum loan amount for studying in India being ₹1.5 crore and for studying abroad being ₹1.5 crore.
3. Easier EMI Options
SBI Education Loans provide more accessible EMI options, allowing students to manage their repayment obligations more effectively.
4. Early Approvals
SBI Education Loans are known for their early approvals, which can benefit students who need timely financial assistance for their education.
5. Tax Benefits
SBI Education Loans offer tax benefits, which can help students reduce their tax liability and make their education more affordable.
6. Better Repayment Options
SBI Education Loans provide better repayment options, including a repayment period of up to 15 years.
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Documents Required for SBI Education Loan
Apart from the SBI application form, there is a list of documents required for SBI Education Loan. Here are the major ones:
Applicant and Co-Applicant KYC Documents
- Identity Proof – PAN Card, Passport (student, if going abroad)
- Address Proof- Passport of applicant/ Voter ID Card/ Ration card/ Electricity Bill/ Telephone Bill/ Bank account statement/ Aadhar card. (If permanent and present addresses are the same then 2 different address proofs will be required)
- Proof of Personal asset and liabilities statement approved by the bank’s branch personnel
- Bank account statement for the last 6 months (Personal/ Salary). For co-applicants, it should show the salary credits if salaried or 1-year business transactions if self-employed.
All the papers should be self-attested.
Student’s Academic Documents
- School, class 10th, 12th and graduation mark sheets
- Fee structure as given by the college or university
- Admission proof of the student in the course, showing the duration of the course
- Scorecard of qualifying entrance exams like IELTS, GRE, GMAT etc
Co-applicant Income documents
If Salaried
- ITR of last 2 years
- Form 16 details of the last 2 years
- Salary slip for last 3 months
- Employers ID card
If Self-employed
- Proof of Business address
- Income Tax Return for the last 3 years
- Profit & Loss account statements in the balance sheet for the last 3 years.
Other Documents
- Joint affidavit with the student and co-applicant in the standard format of the bank.
- Co-applicant declaration stating that all other leftover expenses will be taken care of by the co-applicant only
Additional docs (if applicable)
- All loan account statements (1 year) if any pending loans.
- Payment receipt if made in the past 6 months
- Letter explaining the gap if the students had a failure/break in studies on Rs. 100 stamp paper. (Format to be provided by WeMakeScholars Financial officer)
- Collateral documents (if taking a collateralized loan)
SBI Education Loan Calculator
Knowing the precise amount of your Equated Monthly Instalment (EMI) on your SBI student loan will help you better manage your student finances and plan your expenses. Use SBI Loan Calculator to know the complete details about your loan.
To apply, fill in the appropriate boxes with the loan amount, tenure, and interest rate that you have been approved for or requested from SBI. Decide any prepared payments you wish to make. You can view your EMI information by selecting 'Calculate'.
Example:
Suppose a student wants to pursue a Master's degree program abroad that costs ₹30 lakhs per year. The student has already secured ₹5 lakhs in scholarships and grants, and they plan to contribute ₹3 lakhs from their own savings.
So,
- Total Annual Cost to Attend: ₹30 lakhs
- Gift Aid (Scholarships & Grants): ₹5 lakhs
- Your Financial Contributions: ₹3 lakhs
Based on this information, the SBI Education Loan Calculator will determine the loan amount required:
- Total Annual Cost: ₹30 lakhs
- Less: Gift Aid (Scholarships & Grants): ₹5 lakhs
- Less: Your Financial Contributions: ₹3 lakhs
- Loan Amount Required: ₹22 lakh
The calculator will then provide the estimated monthly EMI based on the loan amount, interest rate, and repayment period.
For example, if the interest rate is 10.55% and the repayment period is 10 years, the estimated monthly EMI would be around ₹26,000.
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How to Apply for SBI Education Loans?
Here's how you can apply for an SBI education loan easily:
Offline
Step 1: Arrive at your nearest SBI branch with the required paperwork.
Step 2: Complete and submit the application form for the SBI Education loan, which you may get from there.
Online
Step 1: Visit the SBI's official website.
Step 2: Go to the section on Education Loans.
Step 3: Select your favourite lending option.
Step 4: Click 'Apply Now'.
Step 5: You will be routed to Vidya Lakshmi's website.
Step 6: Register by inputting all of your information.
Step 7: Finally, apply for the loan.
Step 8: A bank representative will contact you.
Minimal Documentation. Higher Chances of Approval. Easy Online Processes. Check Your Eligibility.
SBI Education Loan Subsidies
SBI provides interest-only loan programmes that enable worthy students to minimise costs while maintaining their academic progress. Below are a few of these schemes:
Certain education loans from the government are also worth checking out.
If you are looking for government interest rates, you must meet specific eligibility criteria.
However, if you want an easy and flexible education loan made explicitly for busy students, check out Propelld!
Why Propelld?
Propelld provides education loans for students. With easy paperwork, flexible eligibility criteria, and convenient repayment schedules, Propelld helps students worldwide achieve their dreams quickly!
There are many more benefits to getting an education loan with Propelld. Take a look at them!
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