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Secured vs Unsecured SBI Education Loan: Interest Rates & Features
Abroad Education Loan | Updated on ()
Confused about which SBI education Loan to choose? The State Bank of India(SBI), one of the leading Education Loan providers, offers both secured and Unsecured education loans. The interest rates for secured and unsecured education loans can make a huge difference in your repayment.
In this blog, we are providing the differences between Secured and unsecured education loan rates. This will help students make informed decisions about SBI education loans. Read down below, compare, and choose the best option.
SBI Secured Education Loan
The Secured or Collateral Education Loan is a loan in which collateral is involved. Which means the applicant is required to pledge collateral as security against the loan amount. These loans are available at a lower interest rate than the Secured education loans.
Key Features:
Requires Collateral (House, Flat, FDs)
Eligible for a higher loan amount
Covers the entire education cost
Lower interest rates
Interest starts as low as 8.65%
Moratorium Period of course duration, plus up to 1 year
Processing fee is 10k + GST
SBI Unsecured Education Loan
The Unsecured Education Loan, or an education loan without collateral, is a loan in which there is no involvement of any collateral. Which means the student is not required to pledge any collateral to get an education loan. The interest rates on these loans are comparatively higher than those of the secured education loans.
Key Features:
Does not require any collateral
Loan amount is limited
Higher interest rates
Moratorium Period of course duration, plus up to 1 year
Processing fee is 10k + GST
Interest starts from 9.15%
Comparison of the SBI Secured and Unsecured Education Loans
Below are the major differences between secured and unsecured education loans
Feature | Secured Loan | Unsecured Loan |
Collateral | Required | Not Required |
Loan Amount | Higher | Limited |
Interest Rate | Lower | Higher |
Repayment Tenure | Up to 15 years | Up to 15 years |
Processing Time | Longer because of document verification | Shorter because of less paperwork |
Popular SBI Education Loans
The SBI offers various education loans under different schemes. The following are the most common education loans that the SBI offers.
SBI PM Vidyalaxmi
SBI Student Loan
SBI Scholar Loan
SBI Study Abroad Loan
SBI Skill Loan
SBI Shaurya Education Loan
Difference Between Secured and Unsecured SBI Education Loan Rates
Loan Scheme | Max Loan Amount | Secured Interest Rate | Unsecured Interest Rate |
SBI PM Vidyalaxmi | Max. 7.5 Lakhs | Starts from 8.65% | Need Based |
SBI Student Loan Scheme | Max 3cr(Secured) | Starts from 9.15% | Starts from 10.15% |
SBI Scholar Loans | Need-Based - | 7.15% to 7.90% | Starts from 7.90% |
SBI Study Abroad Loans | Max 3 Cr(Secured) | Starts from 9.15% | Starts from 8.65% |
SBI Skill Loans | Max 7.5 Lakhs | Start from 9.15% | Starts from 9.65% |
SBI Takeover of Education Loans | Max 3 Cr(Secured) | Start from 9.15% | Need Based |
SBI Shaurya Education Loan | Max 1.5 cr | 9.15% to 10.15% | 9.15% to 10.15% |
Note: The above interest rates may vary based on the profile of the student.
Student Testimonials
I had a very positive experience with WeMakeScholars, especially with my Financial Officer. Despite applying late, my Financial Officer's support helped expedite the loan approval process significantly. His professionalism and clear guidance helped me get my education loan faster.
The detailed, quality content available from WeMakeScholars on Quora and LinkedIn showcases their deep expertise and dedication, and also being a Government of India-funded initiative under the Digital India campaign adds great credibility, trust, and no doubt.
Overall, I highly recommend WeMakeScholars to anyone seeking education loans for studying abroad. -Advitiya Nagpal.
Eligibility Criteria to Secure an SBI Education Loan
As we previously discussed, SBI offers various Education loans to students under different schemes. The eligibility requirements may vary slightly by scheme; however, the general eligibility requirements may include:
Nationality: The applicant and co-applicant are required to be Indian citizens.
Admission Status: The student must secure admission from a recognised university or college.
Co-applicant: Most of the education loans require a co-applicant. A strong co-applicant can enhance education loan approval chances.
Age limit: Generally, students aged between 18 and 35 are eligible to apply for education loans
Collateral: As previously discussed, SBI offers both secure and unsecured education loans. For secured loans, the student is required to pledge collateral to secure the loan amount. This reduces the risk to the lender, and these loans are available at slightly lower interest rates than unsecured education loans.
Academic History: To get SBI education loans, a student is required to score a minimum average of 50% in all previous academics.
The Documents Required to Get an SBI Education Loan
The documents required to secure an SBI Education loan vary based on the education loan scheme, type of education loan, students' profiles, etc. However, the basic documents list is as follows.
Complete Application Form: A loan application form provided by the bank is to be filled out completely by the student.
Identity Proof: KYC Documents confirming the identity of the applicant and the co-applicant.
PAN card
Adhaar card
Passport etc
Admission Status: A document confirming the admission of the student from a recognised university.
Academic Records: Previous academic records of the students, such as 10th, 12th, graduate, post-graduate, etc.
Co-Applicant Financial Proofs: Lenders check the credit history and financial status of the applicant and the co-applicant.
Collateral Documents: If the student is opting for a collateral education loan, the necessary collateral and other related documents as requested by the banks are to be submitted.
How to Apply for an SBI Education Loan
You can apply for SBI Education loans in many ways
Visit your nearest State Bank of India branch and ask about the education Loan products to the branch manager.
Check your eligibility and confirm that you meet the eligibility requirements mentioned by the bank.
Know the document checklist.
Arrange all the required documents and visit the branch again to apply for a student loan.
To ease the loan application process and save time, students can also apply online through WeMakeScholars.
How to Apply Through WeMakeScholars
- Visit the WeMakeScholars website and request a callback.
- Within 1-2 days, you will receive a call from our financial officer assigned to you.
- The financial officer, based on the details you provide, analyses your profile and suggests a loan type, documents required, etc.
- A secure document upload link will be shared with you to upload the necessary documents.
- From here onwards, your financial officer takes charge and keeps you updated with the status of the loan and ensures a smooth and hassle-free education loan process.
- Wherever possible, our financial officer negotiates better terms and shorter processing fees with the SBI.
Applying for Education loans through WeMakeScholars can ensure fast loan approvals. We have a team of dedicated financial officers who lend support throughout the loan process. Our financial officers will provide end-to-end support, making your education loan process stress-free.
Conclusion
SBI offers various education loans to students, helping them achieve their academic dreams. SBI offers student loans ranging from 50 lakhs to 3 CR, based on the student's profile and other factors.
In this blog, we have covered the eligibility and document details required to secure an SBI education loan. Additionally, we have also discovered how to apply for SBI education loans through WeMakeScholars.
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