Understanding ICICI Bank Education Loan Interest Rates

The ICICI Bank education loan interest rates for studying abroad range from 9.00% to 12.50% per annum. The interest rates change based on your course, university, collateral, and overall profile; understanding these rates can help you make an informed decision.

The article explains applicable interest rates, their calculation, factors affecting them, and the payment structure during and post-moratorium.

The ICICI Bank student loan interest rates for studying abroad range between 9.00% and 12.50% per annum. These rate depends on the student’s course, university category (prime or others), and type of loan (secured or unsecured).

Current Interest-Rate Table

As of 2026, the following are the ICICI Bank student loan interest rates for students pursuing higher education abroad:

*Note: The interest rates mentioned are indicative and subject to change. The final interest rate also depends on individual profiles and the bank’s discretion.

ICICI Bank offers secured loans of up to ₹3 crore by accepting assets such as property and fixed deposits (FDs) as collateral. Choosing a secured loan can increase your chances of approval, offer longer repayment tenures, and provide lower interest rates. 

ICICI Bank also offers collateral-free loans of up to ₹1 crore if you don’t want to pledge assets. The approval primarily relies on a good academic record and the co-applicant’s financial profile. 

Applicable Schemes

ICICI Bank implements certain government schemes such as the Dr Ambedkar Central Sector Scheme of Interest Subsidy and Credit Guarantee Fund Scheme for Education Loans. These schemes provide financial relief in different ways; one relieves the out-of-pocket interest burden, and the other offers relatively lower collateral-free rates.

• Dr Ambedkar Central Sector Scheme of Interest Subsidy (ACSIS): 

This is a government scheme that waives 100% of your interest during the moratorium period (your course duration plus up to 12 months after securing employment, whichever comes first). 

The scheme promotes educational opportunities for the Other Backward Classes (OBCs) and Economically Backward Classes (EBCs). This 0% interest subsidy applies to the maximum loan amount of ₹20 lakh. However, after the moratorium ends, you have to pay the standard education loan interest rate at ICICI Bank. 

• Credit Guarantee Fund Scheme for Education Loans (CGFSEL): 

ICICI Bank operates as a Member Lending Institution (MLI) under the CGFSEL. Students can secure a collateral-free loan of up to ₹7.5 lakh with a starting interest rate of 10.95% p.a. 

Notably, there is no loan margin for loans up to ₹4 lakh. This means 100% of the amount comes from the loan without you having to pay any share from your pocket.

Fixed Vs. Floating Interest Rate

While applying for education loans, ICICI Bank gives you the option to choose between fixed and floating interest rates. A floating rate is the interest rate that changes with the RBI repo rate. In contrast, a fixed interest rate doesn’t change regardless of fluctuations in the market. The fixed rate has comparatively higher rates, but can provide better certainty in your repayment planning. 

As a student, your takeaway from these education loan interest rates at ICICI Bank is as follows:

• The floating rate moves with revisions to the I-EBLR (External Benchmark Lending Rate), meaning it affects your EMI (Equated Monthly Instalment) or repayment tenure structure before the rate reset. 

• There is no prepayment penalty, meaning you can close the loan early. 

• There is no lock-in period, meaning that there are no restrictions or waiting periods if you wish to pay off the loan early. Additionally, because the rates are floating, ICICI Bank gives you options regarding the adjustment of your EMI or repayment tenure. 

ICICI gives you the option to switch between fixed and floating rate of interest options. An applicant can switch at any point during the loan tenure, depending on the following terms:

• Floating to Fixed: You can switch from a floating to a fixed rate at a conversion fee of ₹3,000. The new rate is typically set 0.50% to 1.50% higher than the starting floating rate to build in a margin for the bank against market inflation.

• Fixed to Floating: Switching from fixed to floating triggers a penalty of 0.50% to 2% of the remaining principal amount. For example, if you switch before 37 months in the repayment tenure, the penalty rate is 0.50% of the principal. If you switch after 37 months, it is 2% of the outstanding principal amount. 

Note that interest rates are subject to change quarterly through variations in the RBI’s repo rate. Talk to our WeMakeScholars financial officers to explore whether you may qualify for a negotiated interest rate.

Important Conditions

• Interest Rate Figures: The actual ICICI Bank student loan interest rates depend on your or your co-applicant’s profile. The mentioned rates are only ‘starting from’ figures.

• Prepayment Charges: For fixed interest rate loans, there is a 2% prepayment charge on the amount being repaid within 37 months. Prepayment penalties do not apply to floating rate loans.

• Processing Fee: A processing fee of up to 2%, plus applicable GST, applies to the loan amount.

• Premium Vs. Other Universities: Universities in the ‘premium’ category get lower education loan interest rates than universities that come under ‘others’.

• The ₹3 crore Unsecured Loan Hitch: The unsecured loan amount of ₹3 crore mentioned on ICICI Bank’s website is tied to its ‘Instant Education Loan’ product. This loan amount is largely applicable to ICICI Bank’s existing customers who meet the bank’s internal criteria of credit score, high monthly income of ₹15-20 lakh, and even an existing FD with the bank. 

• The Real Unsecured Cap: The standard unsecured loans at ICICI Bank generally go up to only ₹1 crore. However, through WeMakeScholars, you can obtain loans up to ₹1.5 crore through negotiated exceptions (called deviations). Speaking with a financial officer can help you secure education loans with better rates.

The loan type, university category, co-applicant’s financial profile, and their credit score influence ICICI Bank’s interest rates. If you take a loan with a government scheme, it’s common to see slight variations in interest rates. 

Collateral

The education loan interest rate at ICICI Bank can depend on the type of loan you choose. A secured loan backed by acceptable collateral such as property or an FD brings lower rates of interest. Unsecured loans have comparatively higher interest rates, since the bank’s risk increases. 

University 

Interest rates for premium universities are lower, while other non-prime universities have comparatively higher interest rates.

*Note: The interest rates mentioned are indicative and subject to change. The final interest rate also depends on individual profiles and the bank’s discretion.

Co-applicant Profile

A co-applicant refers to the person who shares responsibility for paying the student’s loan. A co-applicant with high and steady income, low debts, and a good CIBIL score of 750+ can help qualify for very low interest rates. 

Government Schemes

For eligible students, government initiatives such as the ACSIS and the CGFSEL provide distinct financial support. In the ACSIS, the effective out-of-pocket interest rate is 0% during your moratorium period. In CGFSEL’s case, the government acts as a guarantor. Thus, ICICI Bank keeps the rate at 10.95% p.a., instead of the higher interest rates typically applied to unsecured loans.

During the moratorium period, simple interest generally applies to the amount disbursed from the education loan, not the total loan amount. Your course type, destination, and university category determine your interest payment structure during this period:

• Partial Simple Interest (PSI): The borrower pays a portion of the total accrued interest in a month. PSI is paid when the student opts for STEM or management courses at the postgraduate level only at premium universities. 

• Simple Interest (SI): The full SI is charged every month if the student has chosen courses other than STEM or management in a premium institute at the postgraduate level. It is also mandated for non-premium universities.

After the moratorium period, the maximum repayment tenure is up to 15 years. 

• Compound Interest: Keep in mind that if you paid PSI or made no payments during the moratorium, any unpaid interest accrued adds to your original principal amount, which triggers compounding.

• Revised Principal Amount: The EMI is then calculated on this higher and compounded principal amount, and not on the original loan amount.

• EMIs: From here on, EMI payments begin. With every EMI payment, you cover part of the month’s interest charges while also reducing the principal balance. 

The education loan interest rate at ICICI Bank determines your EMI structure. Each EMI is split into two parts: interest, calculated on your outstanding principal before that month's payment, and the remainder, which goes toward reducing the principal itself. As the outstanding principal falls, the interest portion shrinks over time, even though your total EMI stays the same. This repayment structure is calculated by the following universal formula:

EMI = P × R × (1 + R)ⁿ ÷ [(1 + R)ⁿ − 1]

Where:

P = Principal loan amount

R = Monthly interest rate

N = Number of monthly installments

Ignore the hassle of large calculations and check the ICICI Bank EMI calculator to find out your EMI rates. 

Simple Calculation Example

If you take a ₹40 lakh loan at an interest rate of 10.50% for a 2-year PG course, the repayment tenure is 10 years, and the grace period is 6 months: 

With monthly simple interest payments, you pay around ₹54,000 per month during the moratorium, which is the calculated EMI.

If you choose to pay partial simple interest, you pay a portion of your calculated EMI. 

The above figures are illustrative. To check the actual EMI you would be paying, it is more reliable to run your numbers through the education loan EMI calculator. 

ICICI Bank offers personalised loans to students. Discussing your options with an education loan expert can make a big difference rather than directly applying to the bank.

WeMakeScholars is a Government of India-backed education finance platform (supported by the Ministry of IT under the Digital India Campaign). Through our direct partnership with ICICI Bank, your profile can be processed to get you negotiated and discounted interest rates. 

Check your eligibility with us to get the best possible education loan deals at ICICI Bank.