Best Education Loans in India: A Comprehensive Guide (2025)

Securing the right education loan is crucial for students planning to pursue higher education in India or abroad. With a wide range of banks and NBFCs offering customized loan options, understanding interest rates, eligibility criteria, and repayment terms can feel complex. 

Here, we have listed down the best education loan options in India, outlining top lenders, essential features, and practical tips to help you make an informed decision

Advantage of Education Loans in India

Key Benefits of Choosing an Education Loan for Your Studies: 

  1. Financial Support – Covers tuition fees, living expenses, and other academic costs without burdening family savings.

  2. Low Interest Rates – Government and public banks offer competitive interest rates for eligible students.

  3. Tax Benefits – Interest paid on the loan is tax-deductible under Section 80E of the Income Tax Act.

  4. Moratorium Period – Repayment begins after course completion, providing financial breathing room to students.

  5. Improves Credit Score – Timely repayment builds a positive credit history, beneficial for future financial needs.

  6. No Collateral for Smaller Loans – Loans up to ₹7.5 lakhs usually do not require collateral.

  7. Accessible to All Backgrounds – Makes higher education accessible to students from varied financial backgrounds.

  8. Covers Domestic & International Studies – Applicable for institutions in India and abroad.
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Top Education Loan Providers in India in 2025

Within the next five years the following entities will lead as education loan providers in India

1. State Bank of India (SBI)

  • SBI rules the educational loan market because they offer both favorable interest rates and multiple payment plan choices. Key schemes include:
  • The Global Ed-Vantage Scheme provides students studying abroad with education loans up to ₹1.5 crore secured at 10.90% interest and offering 15 years of repayment duration.
  • The Scholar Loan Scheme of SBI targets IITs and IIMs among others while providing loan amounts starting from 8.30% interest rate with unlimited lending capability.
  • The Skill Loan Scheme by the bank enables candidates to obtain vocational training loans that reach up to ₹1.5 lakh with an interest rate of 10.50%.

2. Punjab National Bank (PNB)

The Udaan Scheme by PNB provides ideal support for students who want to study abroad.

  • The available loan sum depends on individual need with an interest rate span of 10.00% to 10.75%
  • The financial institution will charge a fee of 1% from the total loan value which must exceed ₹10,000.
  • Repayment extends up to 15 years and incorporates both a grace period after completing your course and before start the repayment term.

3. Bank of Baroda (BoB)

Through its Baroda Scholar Scheme Bank of B.O.B supports students attending global institutions accredited by the appropriate authorities.

  • The bank provides students with loans up to ₹80 lakh at interest rates starting at 10.40% and reaching a maximum of 11.15%.
  • The processing fee is 1% of the loan amount between ₹7.5 lakh and unlimited value.

4. ICICI Bank

The loan amount for international studies offered by ICICI Bank reaches up to ₹1 crore.

  • Interest Rate: 11.00% -- 12.50% per annum.
  • Repayment: Up to 10 years with a course-plus-one-year moratorium

5. HDFC Credila

Education finance operations at HDFC Bank fall under the subsidiary control of Credila.

  • The interest rate for loans reaching up to ₹30 lakh stands at 9.50% while borrowers can request this amount.
  • The processing fee amounts to a maximum of 1% based on the loan amount.
Approval Based on Your 12th Marks. No Co Applicant Required. Check Your Eligibility. 

Key Features to Compare When Choosing the Best Education Loan in India

When evaluating the best education loan in India, prioritize these factors:

Feature Details
Interest Rates SBI (8.30%–10.90%), HDFC Credila (9.50%), PNB (10.00%–10.75%)
Loan Amount Ranges from ₹1.5 lakh (skill loans) to ₹1.5 crore (global studies)
Repayment Tenure Up to 15 years (SBI, BoB) or 10 years (ICICI)
Processing Fees Varies from nil (SBI Scholar Loan) to 1% (PNB Udaan)
Moratorium Period Typically course duration + 6–12 months

Eligibility Criteria for an Education Loan in India

To apply for an education loan, applicants must meet the following general criteria (may vary slightly by bank or financial institution)

Criteria Details
Nationality Applicant must be an Indian citizen.
Age Limit Generally between 18 to 35 years (can vary slightly by lender).
Academic Qualification Must have secured admission to a recognized institution in India or abroad through merit-based selection or entrance exams.
Course Eligibility Loans are available for professional, technical, and degree programs from recognized institutions.
Co-applicant Requirement A co-applicant (parent/guardian/spouse) is usually mandatory for the loan.
Academic Record A good academic record is often preferred by banks.
Collateral May be required for higher loan amounts (usually above ₹7.5 lakhs).
Repayment Capacity Lenders may evaluate the income of the co-applicant or guarantor.

Expenses Covered under Education Loans in India

  1. Fees – Full or partial academic fees charged by the educational institution.

  2. Examination, Library & Lab Fees – Charges related to exams, lab usage, and library facilities.

  3. Accommodation/Hostel Fees – Costs for on-campus or off-campus student housing.

  4. Books & Study Materials – Expenses for textbooks, stationery, and other academic resources.

  5. Travel Expenses – Airfare or travel costs for students studying abroad.

  6. Purchase of Equipment – Laptops, computers, or other essential learning devices.

  7. Project Work/Study Tours – Fees for academic research, project work, or compulsory field trips.

  8. Insurance Premium – Premium for student life insurance or travel insurance (if mandated).

  9. Uniform & Essentials – Costs for items like uniforms or mandatory supplies (e.g., medical kits).

  10. Miscellaneous Education Expenses – Any other reasonable expenses required to complete the course.
‍Minimal Documentation. Higher Chances of Approval. Easy Online Processes. Check Your Eligibility. 

List of Documents Required for Education loan in India 

  1. Completed Loan Application Form – Duly filled and signed by the applicant and co-applicant.

  2. Photographs – Passport-sized photos of both applicant and co-applicant.

  3. Identity Proof – Aadhaar card, PAN card, passport, voter ID, or driving license.

  4. Address Proof – Utility bills, Aadhaar card, passport, or rental agreement.

  5. Academic Records – Marksheets and certificates of 10th, 12th, graduation, or entrance exams.

  6. Admission Proof – Admission letter from the college or university (India or abroad).

  7. Course Fee Structure – Detailed fee breakup provided by the educational institution.

  8. Income Proof of Co-applicant – Salary slips, Form 16, ITR, or business income proof.

  9. Bank Account Statement – Last 6 months’ statements of the co-applicant or guarantor.

  10. Collateral Documents (if applicable) – Property documents, valuation report, or ownership proof.

  11. Passport & Visa Copy (for abroad studies) – For students pursuing education overseas.

  12. PAN Card of Student & Co-applicant – Mandatory for KYC and processing.

Your selection of the best education loan in India requires you to match your academic targets with affordable financial options. Your ability to choose future-focused investments rests upon term comparisons together with eligibility definition and payment arrangement planning.

Start early and make use of scholarships in addition to choosing lenders who provide transparent terms so you can pursue your education without financial worries.

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FAQs About Education Loans in India

Who can apply for an education loan?

Indian students with confirmed admission to a recognized institute.

What courses are eligible for an education loan?

Graduate, postgraduate, professional, technical, and vocational courses.

What are the eligibility criteria for education loans?

Indian citizenship, admission confirmation, and a co-applicant with income.

How much loan can I get?

Up to ₹10 lakhs for India and ₹20–25 lakhs or more for abroad studies.

What is the interest rate on education loans?

Typically between 8% and 14%, varying by bank and scheme.

Is collateral required for an education loan?

Not for loans up to ₹7.5 lakhs; above that, collateral is usually needed.

What is the repayment tenure for education loans?

Generally between 5 to 15 years after the moratorium period.

What is a moratorium period?

The grace period before repayment, usually course duration + 6–12 months.

Are there any tax benefits on education loans?

Yes, interest is deductible under Section 80E for up to 8 years.

Which banks offer education loans in India?

Banks like SBI, HDFC, ICICI, Axis, and NBFCs like Avanse and Credila.

Are there government schemes for education loans?

Yes, such as the Vidya Lakshmi Portal and CSIS subsidy scheme.

Can I prepay the loan?

Yes, most banks allow prepayment without any penalty.

What happens if I fail to repay the loan?

It harms your credit score and may lead to legal or recovery action.

Can I get a loan for online or distance education?

Generally no, unless it's a reputed online program from a recognized institute.

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