SBI Student Loan Scheme

Let’s explore how the SBI Student Loan Scheme helps students turn their dreams into reality.

About the SBI Student Loan Scheme

The SBI Student Loan Scheme is one of the most comprehensive and targeted programs designed to provide students with the necessary financial assistance to pursue their education in India or abroad. Whether it's for tuition fees, exam expenses, or other educational costs, the loan is tailored to meet a variety of needs, ensuring that higher education remains accessible to all. Additionally, the scheme is flexible, offering attractive interest rates and extended repayment periods, making it an excellent choice for those seeking to finance their education without burdening their finances. The SBI education loan undoubtedly stands out as a reliable option for thousands of students aiming to fund their academic pursuits. 

SBI Student Loan Scheme - Rate of Interest

The interest rate for the SBI Student Loan Scheme varies based on the loan amount and the type of course. Here’s an overview:

Note: EBR = Repo Rate + Spread. Currently:

• Repo rate = 6.50%

• Spread = 2.65%

• EBR = 9.15%

Note: Students can use Section 80E of the Income Tax Act to claim tax deductions on interest payments. Use this income tax calculator to estimate your benefits.

Features of the SBI Student Loan Scheme

The SBI Student Loan Scheme is packed with features that make it an ideal choice for students:

• Loan Coverage: Includes tuition fees, exam fees, travel costs, and other educational expenses.

• Loan Limit: Up to ₹1.5 crore for premier institutions.

• Repayment Tenure: Up to 15 years, including the moratorium period.

• Interest Subsidy: Subsidies are available under government schemes for economically weaker sections.

• Flexible Disbursement: Direct payment to the educational institution.

This scheme is aligned with SBI's broader offerings, such as the Child Education Plan, which helps parents easily support their child's education. With attractive interest rates and flexible repayment terms, the SBI education loan stands out as a reliable option for thousands of students aiming to fund their academic pursuits.

Eligibility for the SBI Student Loan Scheme

To qualify for the SBI Student Loan Scheme, the applicant must meet these criteria:

• Nationality: The applicant must be an Indian citizen with valid proof of nationality.

• Admission: The applicant should have secured admission to a recognised course at a reputed institution, either in India or abroad.

• Courses Covered: The loan covers undergraduate, postgraduate, professional courses, and vocational training programs.

• Co-Borrower: A co-borrower, such as a parent, guardian, or spouse with a stable income, must be included to guarantee the loan.

Additionally, this plan complements the Child Investment Plan, ensuring that parents can secure their child’s future education with ease.

Documents Required

Applicants need to submit the following documents:

• Admission letter from the educational institution.

• Fee structure detailing tuition and other charges.

• Academic records (marksheets and certificates).

• Identity and address proof of the applicant and co-borrower.

• Income proof of the co-borrower.

Most Important Terms and Conditions

Before transferring your loan to SBI, here are a few critical terms to know:

1. Loan Amount

   • Studies in India: Up to Rs. 10.00 lakh.

   • Studies Abroad: Up to Rs. 20.00 lakh.

2. Margin Money

   • Up to Rs. 4 lakh: No margin.

   • Above Rs. 4 lakh:

     • Studies in India: 5%.

     • Studies Abroad: 15%.

   • Scholarships and assistantships are included in the margin requirements.

   • Margin contribution may be brought in on a year-to-year basis.

3. Security Requirements

   • Up to Rs. 4 lakh:

     • Co-obligation of parents.

     • No collateral security is required.

   • Above Rs. 4 lakh and up to Rs. 7.50 lakh:

     • Co-obligation of parents with a third-party guarantee (waiver possible based on parental net worth).

   • Above Rs. 7.50 lakh:

     • Co-obligation of parents.

     • Tangible collateral security of suitable value.

     • Assignment of future income of the student.

     • Joint execution of documents by student and parent/guardian.

4. Processing Charges

   • No processing/upfront charges for educational loans.

   • Loans above Rs. 4 lakh for studies abroad require a Rs. 5000 deposit, adjustable against margin money or interest. Non-availment within 4 months results in forfeiture.

5. Interest Rates

   • For updated rates, visit www.sbi.co.in.

   • 0.50% concession for female students.

   • 1% concession if the entire interest is paid during the moratorium period.

   • Simple interest is charged during the moratorium.

   • Penal interest @2% for overdue loans above Rs. 4 lakh.

6. Loan Disbursement

   • Sanctioned at the branch nearest to the student/parent's residential address.

   • Disbursement in stages based on demand, directly to institutions or vendors.

7. Repayment Terms

   • Moratorium Period: Course duration + 1 year, or 6 months after securing a job (whichever is earlier).

   • Repayment Period: 5-7 years after repayment commencement.

   • Extensions for course completion are allowed up to 2 years in exceptional cases.

   • Interest accrued during the moratorium was added to the principal for EMI calculation.

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8. Top-Up Loans

   • Second, loans are permitted for professional courses in India or abroad.

   • Combined repayment begins one year after completing the second course or 6 months after securing a job.

9. Prepayment

   • Prepayment of loans is allowed without penalty.

10. Loan Cancellation

    • Loan cancellation is allowed before disbursement.

    • A processing fee refund is subject to a deduction of administrative charges.

11. Default and Recovery

    • Non-payment may result in legal action and reporting to credit bureaus (CIBIL).

12. Insurance Cover

    • Life insurance cover is recommended for borrowers to safeguard repayment in unforeseen events.

13. Customer Support

    For service-related issues, students can:

    • Call Customer Helpline Numbers.

    • Contact Local Head Offices.

    • Write to the Grievance Cell at Local Head Offices (details on www.sbi.co.in).

    If unresolved, escalate to:

    • Deputy General Manager (Customer Service), Customer Service Dept, SBI, State Bank Bhawan, 4th Floor, Madame Cama Road, Mumbai-400 021. Telephone: (022) 22029456 / 22029451 / 22740432. Email: dgm.customer@sbi.co.in.

14. Disclosures

    • SBI may share loan details with approved credit bureaus without prior notice.

    • SBI is authorised to obtain Credit Information Reports (CIR) from CIBIL and similar agencies.