An education loan helps students finance their studies by covering tuition fees, accommodation, travel, and other academic expenses. It provides financial support for courses in India and abroad, ensuring students can focus on their education without financial burden. TMB bank education loan offers competitive interest rates and flexible repayment options, supporting students for professional, technical, and vocational courses.
By the end of this blog, you will know
Understand the loan amount, margin requirements, repayment period, and eligibility criteria for a TMB Bank education loan.
Get insights into the applicable interest rates, security requirements, and processing fees for studying in India and abroad.
Learn about the step-by-step process to apply for the loan, repayment terms, moratorium period, and additional benefits like loan insurance.
TMB Bank Education Loan: Highlights
The TMB Bank Education Loan is a financial assistance program for parents or guardians who wish to support their children's education in professional or technical courses in India and abroad.
Below are the key details of the TMB bank education loan:
Parameters
Details
Full Form
Tamilnad Mercantile Bank
Loan Limit
Up to INR 10 Lakhs (India)
Up to INR 20 Lakhs (Abroad)
Interest Rate
11.75% - 13%
Loan Margin
There is no margin for loans up to INR 4 Lakhs.
Loans above INR 4 Lakhs :
5% for studies in India
15% for studies abroad
Processing Fee
1%
Loan Security
Up to INR 7.5 Lakhs – No security (parents must be joint borrowers)
Above INR 7.5 Lakhs – Co-obligation of parents, 100% collateral.
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To apply offline, visit the nearest Tamilnad Mercantile Bank branch and request the education loan application form. The bank staff will provide details on eligibility, required documents, and the most suitable loan options.
Applying for an instant student loan online is quick and hassle-free. Follow the simple steps, submit the required documents, and get your loan approved quickly.
TMB Bank Education Loan: Course Eligibility
Below are the eligibility for studies in India and abroad.
Eligible Courses for TMB Bank Education Loan in India
Criteria
Details
Courses Covered
Courses under Government Subsidy Schemes.
Graduate, Postgraduate, and PG Diploma programs from recognised colleges/universities (approved by UGC, AICTE, AIBMS, ICMR, etc.).
Professional courses like ICWA, CA, and CFA.
Courses from IIMs, IITs, IISc, XLRI, NIFT, etc.
Degree/Diploma programs in aeronautics, pilot training, shipping, and nursing (approved by DGCA, Shipping, or Indian Nursing Council).
Courses from reputed foreign universities are offered in India.
Eligible Courses for TMB Bank Education Loan Abroad
Criteria
Details
Courses Covered
Courses under Government Subsidy Schemes.
Graduation: Job-oriented professional/technical programs from reputed universities.
Post Graduation: MBA, MCA, MS, etc.
Specialised courses like CIMA-London, CPA-USA.
Degree/Diploma courses in aeronautics, pilot training, and shipping (recognised by regulatory bodies in India or abroad).
Tamilnad Mercantile Bank (TMB) offers different education loan schemes with varying interest rates based on the loan type. Below are the applicable interest rates:
Loan Scheme
Interest Rate (p.a.)
TMB - Education Loan
12.75% - 13.00%
TMB - Skill Development Loan
11.75%
TMB - Super Education Loan
12.25% - 12.75%
TMB - Education Short-Term Loan
11.75%
TMB - Short-Term Loan for SHG Members
11.75%
TMB Bank Education Loan: Processing Fee
The applicable charges are as follows:
Loan Type
Processing Fee
Studies in India
No processing fee
Studies Abroad (Loan up to INR 7.50 Lakh)
No processing fee
Studies Abroad (Loan above INR 7.50 Lakh)
1% of the sanctioned amount (No upper limit)
TMB Bank Education Loan Margin
The loan margin is the portion of educational expenses the borrower needs to fund while the bank covers the remaining amount. The margin percentage varies for studies in India and abroad, as detailed in the tables below.
Tamilnad Mercantile Bank offers flexible repayment options to ensure students can repay their education loans conveniently after completing their studies. The repayment period includes a moratorium, allowing students time to secure employment before beginning loan repayments.
Below are the details of the repayment terms.
Category
Repayment Terms
Holiday Period
Course duration + 1 year after securing a job (whichever is earlier)
Tamilnad Mercantile Bank (TMB) provides flexible repayment options to ease the financial burden on students. The repayment details are as follows:
1. Moratorium Period
Repayment begins after the course duration plus one year.
2. Employment-Based Repayment
If the student secures a job within a year of course completion, repayment must start one month after employment begins.
3. Loan Repayment Tenure
Candidates must repay the loan within 5 to 7 years after the moratorium.
4. Extension for Course Completion
If the student cannot complete the course on time, an extension of up to 2 years may be granted.
5. Additional Consideration
The bank can approve or deny extensions if unavoidable circumstances lead to incomplete studies.
TMB Bank Education Loan: Security Requirements
Smaller loans generally do not require security, while higher loans may need a third-party guarantee or collateral. Below are the security requirements based on the loan amount and study location.
Loan Amount
Security Required
Up to INR 4 Lakh
No security
INR 4 - 7.5 Lakhs
Parents/guardians must be joint borrowers, along with a suitable third-party guarantee.
INR 7.5 - 20 Lakhs
100% collateral security and student's future income assignment for instalment payment.
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TMB Bank education loan provides financial assistance to cover various educational expenses, ensuring students can focus on their studies without financial stress. The loan covers the following costs:
1. Tuition Fees
Payment for the academic course.
2. Accommodation Charges
Hostel or rental expenses during the study period.
3. Examination Fees
Fees required for exams and assessments.
4. Library and Laboratory Fees
Costs for accessing study materials and practical learning resources.
5. Study Materials & Equipment
Includes books, apparatus, laptops (if essential), study projects, and uniforms.
6. Security Deposits & Institutional Charges
Caution deposits and other applicable institutional fees.
7. Travel & Transportation
Costs related to commuting or travel within the country.
8. Airfare for Overseas Education
One-time passage fare for students studying abroad.
The bank offers education loan insurance, ensuring financial protection in unexpected circumstances. The insurance cost ranges between 1% to 2% of the total loan amount.
TMB Bank Education Loan vs Other Banks
Below is a comparison of education loan details from major banks, including interest rates, loan limits, and repayment terms.
TMB Bank Education Loan: EMI Calculation As Per Interest Rate
To understand how EMI payments work, let's consider an example:
Loan Amount: INR 10 Lakhs
Course Duration: 2 Years
Moratorium Period: 1 Year (No EMI payment during this period)
Interest Rate: 11% per annum
Repayment Tenure: 10 Years (after the moratorium period)
Once the repayment begins, the EMI will remain constant, but the proportion of interest and principal will change over time. Initially, a more significant portion of the EMI goes toward interest, and over time, more contributes to reducing the principal.
Below is a detail of how the loan repayment progresses:
Year
EMI
Interest Paid
Principal Paid
Remaining Loan
1st
INR 17,393
INR 10,960
INR 6,433
INR 11,89,172
2nd
INR 17,393
INR 10,215
INR 7,177
INR 11,07,219
3rd
INR 17,393
INR 9,385
INR 8,008
INR 10,15,782
4th
INR 17,393
INR 8,458
INR 8,935
INR 9,13,764
5th
INR 17,393
INR 7,424
INR 9,968
INR 7,99,941
6th
INR 17,393
INR 6,271
INR 11,122
INR 6,72,947
7th
INR 17,393
INR 4,984
INR 12,409
INR 5,31,257
8th
INR 17,393
INR 3,548
INR 13,845
INR 3,73,170
9th
INR 17,393
INR 1,946
INR 15,447
INR 1,96,790
10th
INR 17,393
INR 158
INR 17,235
0
Calculate your education loan EMI easily with Propelld's EMI Calculator. Get a clear estimate of your monthly payments and plan your finances better.
The Government of India has multiple schemes to support students from economically weaker sections and minority communities financially. Two major schemes under this initiative are:
1. Central Scheme of Interest Subsidy (CSIS)
The CSIS scheme supports students from economically weaker sections pursuing higher education.
2. Padho Pardesh
It is aimed at students from minority communities who wish to study abroad.
Central Scheme of Interest Subsidy (CSIS)
Criteria
Details
Eligibility
Students from economically weaker sections have gross parental incomes of less than INR 4.50 Lakhs annually.
Repayment
Loan repayment starts after completing 12 months of the course or 6 months after securing a job, whichever is earlier.
Applicable Courses
Technical and professional courses from government-recognised institutions after Class XII.
Maximum Loan Limit
INR 10 Lakhs under the IBA Education Loan Scheme.
Subsidy Duration
Moratorium period of 1 year post-course completion or 6 months after getting a job, whichever is earlier.
Implementation Year
Introduced in the academic year 2009–2010 (Effective April 1, 2009).
Loan Disbursement Eligibility
Loans disbursed after April 1, 2009, are covered. Loans sanctioned before this date but disbursed after April 1, 2009, for courses beginning before 2009-10, are eligible for interest subsidy.
Nodal Bank
The government has appointed Canara Bank to facilitate this scheme.
Padho Pardesh Scheme
Step
Details
Inform the Bank
Students must inform their lending bank about the Padho Pardesh scheme introduced by the Ministry of Minority Affairs.
Submit Eligibility Proof
Students must provide proof of eligibility as per the scheme's criteria.
Bank Processing
If eligible, the bank enters the student's details into the Padho Pardesh online portal.
Portal Access
The portal remains open for two months every quarter to process applications.
The TMB Bank Education Loan provides a reliable financial solution for students pursuing higher education. By offering support for various expenses, including tuition, accommodation, and travel, TMB Bank helps students quickly achieve their academic goals.
Propelld is a student-friendly financing platform offering customised education loans with flexible repayment options. It provides quick approvals, minimal paperwork, and competitive interest rates, making higher education more accessible.
The following are the primary benefits of Propelld.
If you need an education loan of INR 7 lakhs, you can avail yourself of it with only a parent or guardian as a co-borrower. No collateral or third-party guarantee is required. You need collateral security and a co-borrower for loans exceeding INR 7.5 lakhs.
Can I get an education loan of INR 3 lakhs without a guarantor?
Education loans up to INR 4 lakhs do not require collateral or a guarantor. However, if the loan amount exceeds this limit, banks may ask for collateral security or a third-party guarantee per their policies.
What is the PM Vidyalaxmi education loan scheme?
The PM Vidyalaxmi Scheme, approved by the Union Cabinet on November 6, 2024, is a Central Sector Scheme designed to provide financial assistance to meritorious students pursuing higher education in India and abroad.
What is the EMI for an INR 10 lakh education loan?
For an INR 10 lakh education loan, the estimated monthly EMI is INR 19,566, based on a standard repayment tenure and interest rate. The total repayment amount, including interest, would be approximately INR 11,73,969.
Can I repay my education loan early?
Yes, you can prepay your education loan before the tenure ends. Early repayment can help you reduce interest costs and improve your credit score. However, some banks may have prepayment charges, so it is best to check with your lender.
How can I reduce my EMI on an education loan?
You can reduce your monthly EMI by choosing a longer loan tenure. However, this increases the total interest paid. If you want to save on interest, opt for the shortest tenure possible while ensuring affordability. Using an Education Loan EMI Calculator can help compare different repayment options.
How do I calculate my education loan EMI?
You can use Propelld's EMI Calculator to calculate the EMI of the education loan easily. Here is the formula to calculate the education loan EMI:
EMI = P × R × (1+R)ⁿ / (1+R)ⁿ−1
Where: P = Loan amount R = Monthly interest rate (Annual interest rate ÷ 12) n = Loan tenure (in months)
For example, if you take an INR 5 lakh loan at a 0.7083% monthly interest rate for 60 months, your EMI can be calculated using this formula.
What happens if I don't repay my education loan?
Failure to repay your education loan can lead to penalties, legal action, and a negative impact on your credit score. If you default, the bank may recover the amount by seizing collateral (if applicable) or taking legal action against the borrower and co-borrower.
What is the maximum loan amount I can get from TMB Bank for education?
TMB Bank offers education loans of up to INR 10 lakhs for studies in India and INR 20 lakhs for studies abroad.
How long is the repayment period for a TMB education loan?
The maximum repayment tenure is 15 years, excluding the moratorium period, which includes the course duration plus one year after securing a job.
What courses are eligible for TMB Bank education loans?
TMB Bank provides loans for graduate, postgraduate, diploma, and professional courses in India and abroad. Eligible programs include MBA, MCA, MS, engineering, medical courses, CA, CFA, pilot training, and degree programs from UGC, AICTE, IIMs, IITs, and recognised foreign universities.
What is the interest rate for TMB Bank education loans?
The interest rates for TMB education loans vary based on the loan scheme:
TMB Education Loan: 12.75% - 13.00%
TMB Skill Development Loan: 11.75%
TMB Super Education Loan: 12.25% - 12.75%
TMB Short-Term Education Loan: 11.75%
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