Bank of India Education Loan for Studying Abroad

Planning to study abroad and unsure how much you can borrow from Bank of India?

Here's a short answer: Bank of India’s Star Education Loan offers financing of up to ₹1.5 crore. The Bank of India education loan can cover full-time degree and postgraduate courses at recognised foreign institutions.

The education loan interest rate is linked to the bank’s 1-year repo-based lending rate (RBLR*), currently 8.35%. The interest rate for loans up to ₹7.5 lakh (unsecured) is 10.05% p.a.; for loans above ₹7.5 lakh (secured), the interest rate is 10.85% based on the scheme’s published spread.

This guide covers what you need to know before applying for a Bank of India education loan: the schemes, loan limit, the university ranking rule that decides which foreign institutions qualify, interest rates, margin, collateral, documents, repayments, and subsidies.

Note: The interest rates and amounts mentioned are indicative, and the interest rate changes whenever BOI revises its RBLR. Confirm the current rate with the branch before you apply for a Bank of India education loan.

*CGFSEL is the Credit Guarantee Fund Scheme for Education Loans. It is a government-backed guarantee for loans up to ₹7.5 lakh. Hence, BOI does not ask for collateral for loans up to ₹7.5 lakh. If you wish to know more about government-supported education loans, refer to our education loan subsidy scheme guide.

Bank of India (BOI) is a public sector bank offering education loans for abroad studies up to ₹1.5 crore under the Star Education Loan. It follows the IBA (Indian Banks’ Association) Model education loan scheme to finance higher studies in India and abroad. It is meant to cover the full cost of education, including fees, hostel, books, equipment, travel, and a laptop.

Features of BOI’s education loan are:

Loans are sanctioned at the sole discretion of the bank, and the amount depends on the student’s employment prospects and the institution’s status; hence, the earning potential after the course is a part of the loan sanction process.

Bank of India offers an education loan for studying abroad on an unsecured basis up to ₹7.5 lakh and on a secured basis above ₹7.5 lakh. Here is how the two compare:

Note: The interest rates and amounts mentioned are indicative, and the interest rate changes whenever BOI revises its RBLR. Confirm the current rate with the branch before you apply.

The Star Education loan is the scheme that Bank of India’s abroad education loan offers. It finances full-time degree and postgraduate courses at recognised foreign institutions. 

Loan Amount for Overseas Studies

Bank of India’s abroad education loan offers up to ₹1.5 crore for both medical (excluding nursing) and non-medical courses. The amount is need-based and depends on the student's expected earning potential after the course.

Expenses Covered

• Fees payable to the college, school, or hostel

• Examination and library fees

• Books, equipment, and instruments

• One-way travel fare or passage money

• A computer or laptop

• Caution deposit, building fund, or refundable deposit (with institution bills)

• Life insurance premium for the student or co-borrower for the loan tenure

• Any other expenses related to education

Students can also opt for a term insurance cover, and the premium can be financed as part of the loan.

Courses and Countries Covered

BOI does not list the countries or universities. The course must be recognised by the local academic or regulatory authority, and the institutions must meet one of these:

• Webometrics: up to world rank 3,000

• QS: up to world rank 1,000

It should be noted that BOI describes both as indicative. If the course is not based on an entrance exam or test-based selection, the bank may assess the loan on the student's employability and the institution's reputation.

The eligible courses must be:

• Graduate degrees that are professional, technical, or any other graduate courses

• Postgraduate degrees, postgraduate diplomas, PhD or master’s courses, such as MCA, MBA and MS, conducted by recognised colleges or universities and recognised by the academic or regulatory authority of the country.

• Courses conducted by CIMA London, CPA in the USA, and similar bodies (only the exam fees paid to the institute, where there is no regular course curriculum).

• Regular degree or diploma courses such as aeronautical, pilot training, and shipping, provided they are recognised by the local regulatory bodies for aviation or shipping abroad by the Director General of Civil Aviation or Shipping in India, for the purpose of employment in India or abroad.

• Courses initiated under various government education loan subsidy schemes.

How to Check if Your University Qualifies

1. Search your university on the Webometrics website and note its world rank.

2. Search your university on the QS World Rankings of top universities and note its rank if it is in the top 1,000.

3. Confirm the course is recognised by the regulator in the destination country.

4. Share the university name and course with your BOI branch to confirm, since the ranking test is described as indicative.

Loans for Students Already Studying Abroad

Students who have already left India for higher education can still approach Bank of India’s abroad education loan. The same eligibility, margin, and security norms apply.

BOI runs several education loan products. The relevant schemes are:

Star Education Loan for Studies in India

This Bank of India education loan scheme provides an unsecured loan up to ₹7.5 lakh, nil margin up to ₹4 lakh, and nil processing fee. The current rate of interest is 1-year RBLR + 1.70% up to ₹7.5 lakh, and above that it is 1-year RBLR + 1.50%. It is for courses approved by UGC, the government, or AICTE, with admissions through an entrance test or merit-based selection.

Star Education Loan for Working Professionals

This scheme is widely chosen by employed people taking part-time or distance courses in India. Up to ₹20 lakh, no collateral required up to ₹4 lakh, and no processing fees.

Star Vidya Loan for Premier Institutions

This scheme applies to students admitted to premier Indian institutions classified under List A, B, and C. This list is available on the official website of BOI. Loan caps have been quoted differently across BOI documents and institution pages, so confirm the limit for your institution with the branch.

Star Pradhan Mantri Kaushal Rin Yojana (Skill Loan)

For skill development courses in India under the government’s skill loan scheme, priced at RBLR + 1.50%. 

The Bank of India education loan interest rate is currently 10.05% p.a. for loans up to ₹7.5 lakh and 10.85% for loans above ₹7.5 lakh. 

The interest rate depends on the loan amount, the concessions you are eligible for, and the RBLR. Here, *RBLR (Repo-Based Lending Rate) is the benchmark to which the Bank of India interest rate is tied and is adjusted when the RBI repo rate is revised. 

Refer to our guide for complete information on the Bank of India interest rate, how it is calculated, EMI calculation, and interest during the moratorium period.

Education loan Margin money is the share of expenses you pay from your own resources. For studies abroad:

The 10% applies to both medical and non-medical courses. Funds go directly to the institution in stages at each disbursement, subject to the bank’s terms. You may also need to submit the previous term’s marksheet before the next instalment.

Student Eligibility Criteria:

• Students must be Indian nationals

• Admission secured at a recognised institution abroad after Class 12 (or equivalent)

• Admission to an approved course; if the admission is not based on an entrance exam or marks, the loan may be sanctioned based on the student's employability and the institution’s reputation.

• The applicant should not have an outstanding education loan with another bank

Eligible Courses and Institutions 

Full-time degree and postgraduate courses, approved by the local academic or regulatory body, at institutions meeting the Webometrics 3,000 or QS 1,000 rule.

Bank of India education loan documents required are listed below:

Let’s see what collateral requirements you should fulfill for a Bank of India’s abroad education loan.

Collateral Requirements

Loans up to ₹7.5 lakh under CGFSEL Guarantee

Loans Above ₹7.5 lakh

Co-applicants Requirement

The co-applicant, typically a parent or guardian, signs as a joint borrower and must provide identity, address, and income proof plus a one-year bank statement.

Which Option Fits You?

You can apply for a Bank of India education loan online and offline, and the complete process is given below:

Offline Application Process:

• Bank Visit: Visit your nearest Bank of India branch and inquire about the education loan products they offer.

• Eligibility Check and Form Completion: Confirm your eligibility and fill out the Bank of India education loan application form according to the requirements.

• Document Compilation and Submission: Compile a checklist of all required documents and submit them to the bank to begin the education loan application process.

Online Application Process:

• Visit the official website of Bank of India or a portal for the application form.

• Look for the "Apply Now" section specifically allocated for education loans and select the applicable scheme.

• Enter your details in the application form, ensuring accuracy and that your documents are complete.

• Upload the mandatory documents as indicated in the loan application guidelines.

• Visit your nearest Bank of India branch for any additional formalities or requirements related to your loan application, if needed.

Processing Time and Sanction

Sanction time depends on document completeness and whether collateral valuation is needed (above ₹7.5 lakh). Apply as soon as you have your admission letter, and keep the loan sanction ready before visa and fee deadlines.

How to Check Your Application Status

Log in to the portal to see your application status, or contact the branch handling your application with your reference number. 

Repayment tenure refers to the period after your moratorium period; during this period, your repayment journey starts. The Equated Monthly Instalments (EMIs) are calculated based on the repayment tenure, and you are asked to pay them until the loan amount is cleared. Bank of India education loan repayment begins after the moratorium, which covers the course period + 1 year, and goes up to 15 years from the date your repayment starts. You can pay simple interest during the moratorium, and BOI states there is no prepayment penalty.

Note: 

• Prepayment: It is paying off part or all of your outstanding education loan before the scheduled repayment date.

• Foreclosure: This is repaying the entire outstanding loan amount before the end of the loan tenure and closing the loan account.

Processing Fee and Other Charges

BOI’s current rate sheet sets the study-abroad processing fees in education loans at up to ₹10,000 (excluding GST). Other applicable charges for Bank of India’s abroad education loan are:

Note: All charges exclude GST unless stated.

The right loan is the one that meets your funding needs on manageable terms, not necessarily the one with the highest loan limit of the bank.

• Efficient Processing: Processing typically takes 21 days for government banks and 7-15 working days for private banks/NBFCs post-document submission.
  

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• Convenient Online Application: Easily apply from home using our student-friendly portal, minimizing the need for multiple bank visits.
  

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The Bank of India education loan is a good option for overseas study if your university ranks within the Webometrics 3,000 or QS 1,000 range. You can get up to ₹1.5 crore for an education loan, collateral-free funding up to ₹7.5 lakh, a 15-year repayment period, and no prepayment penalty. Before applying, confirm your university’s ranking, the interest rate spread that applies to loans above ₹7.5 lakh, and the processing fee with the branch.

Apply with WeMakeScholars, where we will compare education loan options, help prepare your documents, and help you move your application forward without any potential delay. Request a callback today.