About Vidya Lakshmi Education Loan
The most incredible resource for students looking for an education loan is Vidya Lakshmi. It is created by the Indian Banks Association, the Department of Higher Education, and the Department of Financial Services (Ministry of Finance).
The organization responsible for developing and managing this portal is NSDL, or e-Governance Infrastructure Limited. Additionally, using the site, students can monitor, apply, and follow the status of their education loan applications at any time and from any location.
Features of Vidya Lakshmi Education Loan Interest Rates
- Interest rate starts at 8.40% for Vidya Lakshmi education loans.
- Up to INR 4 lakh can be borrowed for a maximum term of 15 years without requiring security.
- Loans up to INR 7.50 lakh do not require collateral, but parents must co-apply.
- For loans above INR 7.50 lakh, collateral security of suitable value and co-obligation of parents are required.
- Students can only apply online via the Vidya Lakshmi website.
- A maximum of three bank applications is allowed at once.
- Loan amounts may be disbursed within 15 days of submitting the application form.
- Repayment begins after completing the course, with a grace period known as the Moratorium period lasting one year or six months after securing a job.
- Loans are governed by the Reserve Bank of India (RBI) and the Indian Banking Association.
- Interest rates are based on "Marginal Cost of Credit-based Lending Rates" (MCLR).
- Each bank adds between 2% and 6% to their assigned MCLR.
- Students can analyze projected interest rates for education loans at different banks based on their awareness of MCLRs.
Note: Each bank qualified to provide the loan has a different interest rate.
Know more about How an Education Loan works in India.
Vidya Lakshmi Education Loan Interest Rates
Before discussing the interest rates on education loans, let’s understand an important term: MCLR.
What is MCLR or Marginal Cost of Credit-Based Lending Rates?
Based on standard lending rates established by the RBI and the Indian Banking Association, all Indian banks offer student loans. The Marginal Cost of Credit-Based Lending Rates is the name given to these rates. Each student loan interest rate, is calculated as a percentage added to these base rates.
Nearly all banks add amounts between 2% and 6% above their assigned MCLR. Understanding this MCLR enables students to independently analyze the projected interest rates for education at different banks.
The following are the Vidya Lakshmi Education Loan Banks' MCLR rates. You can check the monthly changes in MCLR rates for different banks since they are updated monthly.
Vidya lakshmi Education Loan Interest Rates Across Banks
Benefits from Interest Paid on Education Loans Co-applicants and applicants for Study Loans are eligible to get tax benefits on Interest paid. As a result, the Interest paid on the loan may be subtracted from the applicant's or co-applicants total taxable income if they make school loan EMI payments. The following are a few oddities about tax benefits on college loan interest rates:
- The interest tax benefit on education loans is limited to eight years of claimable income.
- The deduction is limited to the entire amount of the section 80E deduction; if the loan is paid off before the eight years have passed, the benefit cannot be claimed for the remaining time.
- Only the EMI-paying applicant may claim the tax benefit from an education loan interest subsidy; the tax benefit cannot be claimed if an interest subsidy is already claimed.
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Banks Listed on the Vidya Lakshmi Portal
This is a list of banks that are registered on the Vidya Laxmi portal. These banks offer education loans, which students can apply for.
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Tax Benefits on Vidya Lakshmi Education Loan Interest Rate
Benefits from Interest Paid on Education Loans Co-applicants and applicants for Study Loans are eligible to get tax benefits under Section 80E on Interest paid.
However, the following are a few limitations about tax benefits on college loan interest rates:
- The interest tax benefit on education loans is limited to eight years of claimable income.
- The deduction is limited to the entire amount of the section 80E deduction; if the loan is paid off before the eight years have passed, the benefit cannot be claimed for the remaining time.
- Only the EMI-paying applicant may claim the tax benefit from an education loan interest subsidy; the tax benefit cannot be claimed if an interest subsidy is already claimed.
How to Claim Income Tax Benefits on Vidya Lakshmi Education Loan Interest Under Section 80E?
There is no unique procedure for receiving a deduction for Interest paid on student loans. Individuals are the only entities eligible to get education loan tax benefits, corporations or businesses are not. The procedure is the same as for any other income tax deduction application. To claim this tax deduction, follow these quick steps:
- Obtain an interest payment certificate for the student loan from the relevant bank branch.
- If the applicant has accessed online banking, they can also download this interest certificate from the bank's official website.
- Only the information on Interest paid for the current fiscal year should be included.
- It needs to be validated with a seal or bank stamp.
- When filing an income tax return, note the interest amount paid under Section 80E deductions.
- Attach your ITR documentation and a copy of the interest certificate.
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Vidya Lakshmi Education Loan Interest Rate: Points to Remember
Here are a few points that you must take care while checking the interest rates and applying for Vidya Lakshmi Education loan:
- Look for the most recent rates before applying because most student loan interest rates are MCLR-based.
- Your course and school determine interest rates on student loans.
- Subsidies for interest rates must be requested individually; they are only sometimes granted.
- Section 80E of the Income Tax Act allows taxpayers to deduct student loan interest.
