Education Loan

Education loans are offered to students to finance their higher education in India and abroad. Multiple financial institutions like Public sector banks, private banks, and NBFCs offer student loans to students. An amount between 1 lac to 1.5 cr can be offered as a student loan in India with education loan interest rates starting from 7.5%. Student loans are offered on the basis of the student's profile and which kind of course and university they are going to study at.

WeMakeScholars (WMS) is an organization supported by the IT Ministry, Govt of India under the Digital India Campaign. Our motive is to offer unbiased student loan support to students who are looking to pursue higher education in India and Abroad. All the services of WeMakeScholars are FREE of cost. We are associated with 14+ banks (public/pvt) in India and help you get the best abroad education loan matching your profile. Interested students in a student loan can request a callback from the team. 

The advantages of applying for an education loan through WeMakeScholars are listed below:

1. Better education Interest rates: Banks offer lower student loan interest rates on the student loan if the loan application is via WeMakeScholars, as we are their largest partner. The student loan interest rates through WeMakeScholars are 0.5% to 2% lower than the bank’s average. 
2. Fastest processing time: We maintain an average sanction timeline of 21 working days for Govt. banks and 7 working days for Private banks and NBFCs, after the submission of all documents from your end. It is 50% less than the time the bank takes directly.
3. End-to-end support: Not just with your loan sanction, the WeMakeScholars team also helps you with disbursement and repayment of your student loan, even when you are in a 12-hour different timezone.
4. Cashback offered: You get a cashback of up to ₹3000 after you take your education loan has been disbursed.

1. Up to INR 75 lacs* for an education loan without collateral
2. Up to INR 1.5 cr* for an education loan with collateral
3. Interest rate starts at 7.5% (depending on the RBI repo rate)
4. A student loan Interest rate concession of 0.5% for female students, offered by Govt. banks.
5. A moratorium period is offered for all student loans - start repaying 6 months to 1yr after studies abroad or in India
6. Repayment tenure up to 15 yrs.
7. Loan offered without admission letter or i20
8. Pre-visa disbursement of study loan is possible
9. Avail income tax under section 80E
10. Avail concession in TCS on foreign remittance with a student loan

*Please note that all the above-mentioned parameters slightly vary depending on the student's profile, university, and course. Once you speak with the Financial Officer at WeMakeScholars after requesting a callback, you will get to know the exact option that matches your profile.

1. Under section 80E of the Income Tax Act 1961, the complete interest amount of a student loan can be claimed as a tax-free expense which means up to your effective interest rate will be 30% less than quoted.
2. Under section 80C of the Income Tax Act 1961, an individual can claim an interest portion of up to 1.5 lacs from the total taxable income.
3. TCS on foreign remittance: When you send money abroad, you need to pay TCS on foreign remittance. TCS is 5% if you are sending money from your own account and it is 0.5% only if money is coming through an education loan, so there is a saving of 4.5% on foreign remittances.

1. Secured or Collateral Education loan:

Going for a collateralized student loan requires you to pledge your collateral (an asset) against your study loan. The collateral accepted by lenders are of two types:

• Immovable property: House, flat, or non-agricultural land.
• Liquid security: Fixed deposits, Insurance policies (term insurance),  or and Government bonds.

 2. Unsecured or Non-collateral Education Loan:

Non-collateral student loans do not require mortgaging any collateral.

Check the latest Interest rates for student loans

Let’s go through the application process for an education loan.

Offline:

If you want to apply for an education loan offline, then you can visit the nearest bank branch and speak to the bank manager.

Online:

It is possible to start your study loan process online for all Govt. banks, private banks, and NBFCs.

The steps are as below:

Step 1: Fill out the Student Loan Common Application form or request a callback 

Step 2: You will receive a call from your financial officer, to check your eligibility. Provide all the required information.

Step 3: Compare and choose your lender bank from all the lender options as per your eligibility and education loan policies.

Step 4: Submit your documents in the bank or upload your documents on the WeMakeScholars secure document portal, as per the documents checklist shared by your financial officer

Step 5: After document submission, your file will be logged in. You will receive a student loan decision within 2-6 days for Private banks like Axis, and ICICI and within 15-20 days for Govt. banks.

Step 6: After the sanction, you can sign the education loan agreement and collect your sanction letter.

Study loans are offered by Public banks, Private banks, and NBFCs in India. Top banks and NBFCs are mentioned below:

• State Bank of India (SBI)
• Bank of Baroda (BOB)
• Canara Bank
• HDFC Credila
• Axis Bank
• Karur Vysya Bank
• Avanse
• Union Bank of India (UBI)
• HDFC Bank
• ICICI Bank
• Punjab National Bank (PnB)

*Note: These interest rates are effective as of Nov 2022. The student loan interest rates may change with changes in RBI repo rate and bank policies.

Section 1: Study Loan Application form 

Bank Application form with 2 passport-size photographs (online copy generated by WeMakeScholars is acceptable)

Section 2: Basic documents for Applicant (student) and co-applicant and/or Guarantor

1. Proof of identity –PAN Card (and Passport of the student if going abroad)
2. Proof of Residence – Voter ID Card/  Passport/ Electricity Bill/ Telephone Bill/ Ration card/ Bank account statement/ Aadhar. (2 different proofs if current and permanent residence are different)
3. Bank account statement for the last 6 months (Personal/ Salary). For co-applicants, it should show the salary credits if salaried or 1-year business transactions if self-employed.
4. Personal Asset & Liability Statement (assessed by the branch professional)
5. All the documents should be self-attested.

Section 3: Academic Documents for Applicant

1. Education mark sheets and certificates- 10th, 12th, Degree
2. Proof of admission for the course (should be evidencing total duration of the course)
3. Fee structure
4. Entrance exam scorecard

Section 4: Income Documents for Co-applicant

If Salaried

1. Latest Salary slips (for the last 3 months)
2. Form 16 of the last 2 years.
3. Employers ID card
4. ITR of last 2 yrs

If Self-employed

1. ITR of last 3 yrs
2. Last 3 years' Balance sheet and Profit & Loss account (only if self-employed)
3. Proof of Business address

Section 5: Other Documents

1. Letter stating that leftover expenses, apart from loan amount will be borne by the co-applicant (Format to be provided by WeMakeScholars Financial officer)
2. Notarised joint affidavit with the student and co-applicant in the Bank’s standard format (Format to be provided by WeMakeScholars Financial officer)

Section 6: Additional docs (if applicable)

1. Receipts of advance payments made if any.
2. All loan account statements (1 year) if any pending loans.
3. Letter explaining the gap if the students had a failure/break in studies on Rs. 100 stamp paper. (Format to be provided by WeMakeScholars Financial officer)

Section 7: Collateral Documents (Optional)

It is only applicable for collateralized study loans. The list of documents for each state is different. Request a callback and ask your WeMakeScholars Financial officer for the state-specific collateral documents list.

When you process your student loan with WeMakeScholars, your financial officer will provide you with a detailed documents checklist, after analyzing your profile.

Applicant:

• The applicant must be an Indian citizen residing in India or NRI.
• Overseas Citizens of India (OCI) and Persons of Indian Origin (PIOs) are eligible for student loans to study in India but not for overseas education.

Co-applicant:

• The co-applicant must also be an Indian citizen residing in India or NRI.
• Overseas Citizens of India (OCI) and Persons of Indian Origin (PIOs) are eligible for education loans to study in India but not for overseas education.
• Applicants must have any of their parents/ parent-in-law/ siblings/ spouse as their co-applicants while applying for a student loan

University and course:

• The applicant should have an admission letter from a recognized School abroad or in India.
• The applicant must have opted for a full-time or part-time UG/PG program.
• An exceptional academic record is always beneficial for the process.

Courses:

• Graduation courses: BA, B.Com, B.Sc., etc.
• Post Graduation courses: Masters & Ph.D.
• Professional courses like Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Architecture, Computer, etc.
• Management courses include Hotel Mgt., Hospitality Mgt., Event Mgt., Mass Communication, etc. offered by reputed institutions having assured employment prospects
• Computer certificate courses of reputed institutes accredited to Dept. of Electronics or institutes affiliated with an approved university.
• Courses like ICWA, CA, CFA, etc.
• Courses conducted by IIM, IIT, IISc, and XLRI. NIFT etc.
• Regular Degree / Diploma courses like Aeronautical, Pilot training, Shipping, etc., approved by the Director General of Civil Aviation/shipping or equivalent foreign body
• Evening courses of approved institutes.
• Other courses leading to diplomas/degrees etc. conducted by colleges/universities approved by UGC / Govt./ AICTE / AIBMS / ICMR etc.
• Teachers Training Course / Nursing Course / BEd will be eligible for study loans provided the training institutions are approved either by the Central Government or by the State Government and such courses should lead to Degree or Diploma Courses and not to Certificate Courses.
• For abroad studies, Regular Graduate Degree/Post-Graduate Degree/Diploma/Certificate/ Doctorate courses in any discipline offered by abroad Institutes/Universities in USA, UK, Canada, Australia, Singapore, Japan, Hong Kong, New Zealand and Europe [Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Poland, Portugal, Russia, Spain, Sweden, Switzerland, United Kingdom] will be primarily considered for the education loan. Other countries are acceptable on a case-by-case basis.

However, the specific eligibility depends on your bank and the scheme, under which you are taking the education loan. There is always a possibility of deviation from the usual process, but this advantage only lies with the students, who process their student loan with WeMakeScholars, Request a callback, or fill out the common application form to avail of all the benefits.

When you choose WeMakeScholars as your student loan partner, all updates regarding your process will be shared with you within no time, via email, SMS, and WhatsApp text, along with that with WeMakeScholars you get:

• Round-the-clock availability -  We are available from 9 AM to 9 PM, for your convenience, you can call your financial officer to know the status of your loan process.
• Loan profile credentials - You can access your loan profile using your loan profile credentials and track the status of your application  
• Digital empowerment - In the era of digitalization, WeMakeScholars empowers you to apply, process, and track your study loan all from the comfort of your home.
• Direct connectivity to lenders - You are provided the contact information of executives handling your file, using which you can directly reach out to the lender's team if required.

WeMakeScholars is a government-funded non-profit organization, supported by the Ministry of Electronics & Information Technology under the Digital India Campaign. We do not ask for any service charges or fees from students to process their loans. All our premium services are totally free of cost.

Here is a list of processing fees and other charges of Banks and NBFCs:

Government Banks include the State Bank of India (SBI), Bank of Baroda (BOB), Canara Bank, and Union Bank of India (UBI), Punjab National Bank (PnB) etc, Whereas Private banks and NBFCs include institutions like Axis Bank, ICICI Bank, HDFC Bank, Avanse and Auxilo 

Knowing the EMI schedule helps students and parents in planning their repayment. EMI calculation is not as simple as home loans or personal loans, because in Education loans EMI payment starts after the moratorium period that means for course duration plus 6 to 12 months, you won’t have to pay EMI.

WeMakeScholars is the only EMI calculator on the internet that is designed specifically for student loans. It takes into consideration semester-wise disbursement, partial payments made during the study period, and any extensions of the moratorium offered.

You can use the EMI Calculator by WeMakeScholars to have a precise EMI amount and amortization schedule for you.

• Tuition fees- The tuition fee that is mentioned in your offer letter or admit card
• Living expenses- These may comprise accommodation costs, food, and travel expenses
• Health insurance- Many lenders include health insurance in the expenses
• Travel tickets- Two-way flight ticket once per year
• Books & Stationery cost - Books & stationery expenses incurred during the entire course of study
• Laptop & Computer cost -  If required for the course, students can utilize the money from their study loan to purchase a laptop or computer.
• Cautionary deposit- The amount of up to 10% of the amount can be utilized as a cautionary deposit.
• Two-wheeler- The Loan amount can include up to 50,000 towards the purchase of a two-wheeler.
• Miscellaneous expenses- Any other expenses incurred towards field visits or projects.

Central Scheme for Interest Subsidy (CSIS)

The scheme was announced by the MHRD, now the Ministry of Education, to grant interest subsidies on study loans to students belonging to the EWS section of society. 

Eligibility criteria for CSIS 

• The annual family income of the student should not exceed Rs 4.5 lacs per annum.
• Students should have mandatory proof of belonging from the EWS section of society.
• Students must secure admission in approved courses of study in India only

Benefit: Under the scheme, in the moratorium period, eligible students need not pay any interest for their student loans taken to study in India.

Padho Pardesh Scheme

The interest subsidy scheme was launched by the Ministry Of Minority Affairs, GOI to benefit meritorious study-abroad aspirants belonging to economically weaker sections of notified minority communities.

Eligibility criteria for Padho Pardesh Scheme

• Students should pursue courses at Masters, M.Phil, and Ph.D. levels.
• Students should have availed of student loans from a scheduled bank under the Scheme of the Indian Banks Association.
• The total family income of the student should not exceed Rs 6 lacs per annum.
• An income certificate issued by government-approved authorities is mandatory.

Benefit: Moratorium period interest will be borne by the government up to a max of 20 lacs study loan amount.

Dr. Ambedkar Interest Subsidy Scheme for OBC and EWS Students

The interest subsidy scheme was launched by the Ministry of Social Justice and Empowerment, for students belonging to OBC and EBC sections of the society, on the interest payable within the moratorium period. This scheme is for eligible abroad study aspirants.

Eligibility criteria for Dr. Ambedkar's Interest subsidy scheme for OBC and EBS students

• The annual family income of the student should not exceed Rs 8 lacs per annum for OBC category and EBC category
• Students should have secured admission in the approved courses at Master, M.Phil, or Ph.D. levels abroad
• A student should have taken the loan from the scheduled bank as per the Indian Banking Association guidelines
• For students belonging to the OBC category, a caste certificate is mandatory.

Benefit: Moratorium period interest will be waived off.

Credit score or CIBIL score is the measure of the financial credibility of any individual. A person with a good CIBIL score has a greater chance of getting a student loan faster. But what is a good CIBIL score? 

Don’t worry, the table will tell you if your CIBIL score is up to the mark or not.

Request a callback from your financial officer at WeMakeScholars, to find a way to process your Student loan in spite of a lower CIBIL score.

HDFC Credila:

• Up to 100% finance of I20 value
• Option of 100% non-collateral student loan
• Sanction before admission for i20
• Doorstep service

Avanse:

• 100% education finance
• There is no limit to the maximum amount
• Sanction within 1 day after logging the file
• Prefers meritorious students
• Can disburse in 1 installment
• Doorstep service

Incred:

• Accepts multi-city co-signers
• Can cover all the expenses of a student
• All charges are included in InCred's origination fees
• Can provide pre-visa disbursal if the situation demands
• Doorstep service

Auxilo:

• 1% processing fees
• 100% Finance
• Pre-admission student loan
• Pre-Visa study loan disbursement
• Fast-track student loan
• Competitive interest rates

Credence:

• Offers a student loan tenure of 15 years
• 100% digital process
• Approval in 6 hours
• 48 hours to transfer fund
• Can provide an unsecured loan of up to 50 lacs

Other NBFCs offering study loans are Aditya Birla Capital, Tata Capital, Bajaj Finserv

Immovable Property:

Liquid Security:

Banks understand that students cannot start repaying immediately after getting an education loan. Hence, they offer a moratorium period of course duration plus 6 months up to  1 year. Students need not pay any interest during the moratorium period. However, for public banks, it is not required for students to pay simple interest in the moratorium period but, private banks may ask for interest payments during this period.

After the Moratorium period ends, students will have to pay the previously calculated EMI to repay their outstanding loan within the stipulated repayment period.

For instance, if you take a student loan of say Rs 40 lacs to pursue higher education at a 9% rate of interest, for a duration of say suppose 15 years, then your EMI repayment table will look like this:

EMI will be auto-debited from your account after your moratorium period that is course duration plus grace period is over. You may also use Internet banking or Cheque to pay your EMI. So make sure there is sufficient balance in your account and plan your repayment wisely.

We are a dynamic team of expert individuals, who are determined to fulfill your dream of abroad education, and that is why, we are always available to resolve all your doubts and queries at any stage of your student loan sanctioning process. You can reach out to us by:

• By calling your assigned financial officer during office hours or by calling our support team at +919393344424.
• Alternatively, you can drop an email to the customer support team of WeMakeScholars at hello@wemakescholars.com.

Feel free to reach out to us at any stage of your student loan process, we will try our level best to resolve your concern as soon as possible.

To close your student loan you need to follow the below steps:

• Check your outstanding loan amount through Internet banking in your student loan account
• Issue a cheque to your bank for the due amount.
• Once you receive confirmation from banks, stating “no dues pending”
• Fill out the study loan closure form via online or offline mode

Tip: While issuing a cheque for the outstanding amount, keep a little extra amount, in case the manager closes your loan the next day, there shouldn’t be an additional outstanding amount.