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Education Loan-Frequently Asked Questions

Wednesday, October 21, 2020 / No Comments

Which courses are eligible to be applied for Education loan? 

The graduation, post graduation, technical degree, technical diploma, professional degree, professional diploma courses conducted by UGC, AITCE, IMC and govt recognized colleges and universities. Regular degrees and diploma courses of autonomous institutions like IIT, IIM etc Central govt recognized teacher training and nursing courses. Regular degree or diploma courses like aeronautical, pilot training, shipping recognized by the Director General of Civil Aviation, Director General of Shipping etc. 

What are the purposes served by this loan? 

This loan facility is to provide financial aid to the students for their higher studies. Moderate rate of interest, interest subsidy and processing are its major attractions. 

Who are eligible to apply? 

The students should have qualified the entrance exam for professional and technical courses. In the case of courses abroad, the admission must be confirmed in universities or colleges. 

What the courses abroad? 

MCA, MBA, MS and such job oriented professional technical graduation courses conducted by the reputed universities abroad, post graduation courses Chartered Institute of Management Accounts in London, Certified Public Accounts in America 

What about the fee details and expenses covered? 

(a) hostel fee. The students arranging self accommodation should get their expenses certified by the authority concerned. 
(b) exam fee, library fee and lab fee 
(c) for books, uniform, instruments, computer and other such accessories. 
(d) study tour, project work, thesis submission etc. But it should not exceed 20% of course fee 
(e) for buying two wheelers and getting insurance premium in the name of the applicant 

What is the maximum amount of Education loan admitted? 

For studies in India, maximum of Rs.10 lakh and for abroad, Rs.20 lakh. 

Will it cover entire study expenses? 

For a loan amount upto Rs.4 lakh, there is no margin money and the entire amount of expenses met by the students will be allotted. For a loan amount above Rs.4 lakh, the applicant have to meet 5% and 15% of the expenses in India and abroad respectively. 

Is there any security needed for Education loan approval? 

There is no need of any security for an amount up to 7.5 lakh where as either of the parent should be the co-applicant. For approving a loan amount exceeding 7.5 lakh, apart from co-obligation of the parents, a security, equal to that amount is needed. In the case of ‘married’, either the partner of parents’ partner can be the co-applicant. 

What would be accepted as security? 

Assets, buildings, govt securities, Public Sector bond, National Savings Certificate, Kissan Vikas bond, LIC policy, gold shares, shop agreements, fixed deposits in banks etc. 

What is the loan procedure? 

The applications are considered for approval by the branch in the residential area of the applicant. Now a days, it is mandatory to apply through the Vidyalakshmi Portal. The loan amount will be distributed in terms to the educational institutions. If the applicant has self- remitted the course fee or any such, it can be claimed for reimbursement within months and the amount would be credited directly to the applicant by the bank. 

What is the time limit for repayment of Education loan? 

The repayment period of the loan usually starts a maximum of one year after the completion of the course and it should be completed on time. The bank may extend the repayment period up to 2 years. During the moratorium period and repayment holiday, EMI is fixed for the interest along with the capital amount. 

What is top up loan? 

If the applicant gets admission for another course during the moratorium period of the first loan, top up loan can be availed of. The repayment period of both the loans would start, one year after the completion of both the courses. 

Is there any subsidy available for the interest? 

The Central govt would take over the interest till the repayment period starts after course completion for the economically weaker section. It should be made clear regarding how the subsidy is given by the banks, before availing of loan. This subsidy under Central sector interest subsidy scheme is available for loans from scheduled banks. The income of parents should not exceed Rs.4.5 lakh. Please visit https://www.vidyalakshmi.co.in/Students/ to apply for educational loans. For more clarifications, contact the bank concerned for loans.
Downloads
Education Loan-Frequently Asked Questions(PDF)

Guidelines on Education Loan Repayment Support Scheme

Monday, May 22, 2017 / 10 Comments
The Finance Department has published detailed guidelines regarding Educational Loan Repayment support scheme declared in the Kerala budget to aid the debtors who availed of the Educational loan. This scheme is applicable for educational loan upto Rs.9 lakh. Students whose annual family income is upto Rs.6 lakh are the beneficiaries of this scheme. For students with more than 40% physical disability, the annual family income limit is Rs.9 lakh. 

This scheme is advantageous for govt and recognized technical and professional courses in India. Students admitted in Management, NRI quota and studied in unrecognized institutions are exempted from this privilege. 

Students admitted for Nursing Courses in Management quota also can be benefited under this scheme. Those who have started to repay the loan before 1st April 2016 are the scheme beneficiaries. 

Government will disburse 90% of the amount in the first year, 75% in the second year, 50% and 25% in the third and forth year respectively. As the bank writes off the complete interest amount of the expired students and mentally or physically disabled ones due to accidents during the loan tenure their entire loan amount will be repaid by the govt itself. To download the detailed guidelines,application form and annexure of the finance department click the links.
Downloads
Education Loan Repayment Support Scheme-Govt Order GO(P) No 65/2017 fin dtd 16-05-2017
Guidelines on Education Loan Repayment Support Scheme
Education Loan Repayment Support Scheme-Application Form(Annexure 1)
Education Loan Repayment Support Scheme-Eligibility Certificate(Annexure 2)
Education Loan Repayment Support Scheme-Claim Certificate by Bank(Annexure 3)
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