Karur Vysya Bank Education Loan

Karur Vysya Bank (KVB) has been a prominent player in the Indian banking sector since 1916, with a strong focus on customer satisfaction and innovation. Currently, KVB has a network of around 780 branches across the country, making it a trusted name in the financial industry.

When it comes to education loans for studying abroad, KVB is relatively new in this field, which is why they offer competitive interest rates, flexible repayment options, and quick processing, making them an attractive choice for students aspiring to pursue international education. This article will provide all the details about the main features of KVB's education loans and how their loan application process for studying abroad differs from other banks.

After comparing various public and private banks such as SBI, BOB, Union Bank, Canara Bank, and PNB, we have found that Karur Vysya Bank (KVB) is the best bank for secured education loans. In this blog, we will provide you with all the necessary details to help you make an informed decision in your education loan journey for studying abroad.

Karur Vysya Bank offers abroad education loans as per the following loan conditions

* If you are going for a UG course and require more than 1 cr, the co-applicant income should have to be more than 15 LPA.
** An additional charge of around Rs 8,000 - Rs 10,000 is charged from students for legal and valuation reports, if they apply for an education loan with collateral.

But WeMakeScholars, being a government-funded initiative, does not charge any fees from the students to provide education loan processing support. It means all our services are completely free.

This video covers everything you need to know about the Karur Vysya Bank Education Loan for studying abroad. It includes details on schemes, loan amounts, interest rates, and processing fees, as well as information not found elsewhere online. 

• Indian National: The applicant must be an Indian citizen or have a valid Indian passport.
• Admission: Admission to the university/institute should have been based on an entrance exam or on a merit basis.
• Guarantor: In the case of individual loans, the candidate must present their father/guardian as a guarantor

• Graduation: For job-oriented professional/ Technical courses offered by reputed Institutions
• Post-graduation: MBA, MCA, MS, etc. Job-oriented technical/ professional courses
• Post Graduate Diploma courses offered by reputed Institutions
• Doctorate Programmes (Ph.D.)

(Degree/diploma courses like PG certificate, MBBS, UG Diploma, pilot training, aeronautical, shipping, etc. are also eligible but for that you need co applicants with a very good income profile.)

Karur Vysya Bank (KVB) helps students with their education costs through a loan that covers many different expenses. Whether you're studying in India or abroad, KVB's loan includes various costs you might face during your studies. While you can find more details in a separate article, here's a quick look at some of the things the KVB education loan can help you with.

Educational Institution Fees: This covers charges related to college/school/hostel, including tuition, lodging, examination, library, and laboratory fees.

Study-Related Costs: Expenses such as travel expenses, purchase of essential materials like books, equipment, instruments, uniforms, and computers necessary for course completion are included.

Additional Course Expenses: This covers any other essential expenses required to fulfill the course requirements, such as study tours, project work, thesis expenses, etc.

Deposits and Funds: Expenses related to the caution deposit/building fund/refundable deposit supported by institution bills/receipts

Insurance Coverage: Borrowers have the option to include insurance in their loan package, and the premium amount will be factored into the loan term.

Tax Collected at Source (TCS): The TCS for foreign remittances are also included in the expenses.

Starting from October 1, 2023, foreign remittances exceeding Rs 7 lakhs (except for medical and educational purposes) are subject to a TCS of 20%. For education remittances, the TCS rate is 0.5% for loans.

 NOTE- According to the data above, it is clear that you would be paying almost 90% less tax on foreign remittances if you are sending money through an education loan.

Are you planning to apply for a student loan through the  KVB? Before you proceed, it's crucial to gather all necessary documents to ensure a smooth processing of your loan application. Meanwhile, you can check out this blog “Documents Required for an Education Loan”, there we have provided you the complete list of the mandatory documents required for processing your education loan.Below, we've outlined the essential documents required by SBI for your convenience

1. Completed Application Form: Obtain the application form either from the bank directly or request it from our financial officer through a callback.
2. Admission Confirmation: Provide proof of admission from your chosen university or educational institution.
3. Identification Copies: Submit copies of identification documents such as Passport, Voter ID, Driving Licence, or PAN Card.
4. Passport Photos: Include two recent passport-size photographs of the applicant, co-applicant, and guarantor.
5. Educational Records: Present your latest mark sheet along with the results of any relevant entrance exams (e.g., CAT, GRE, GMAT, TOEFL, IELTS, etc.).
6. Financial Records:
   
   1. Income Proof: Furnish income proof of parents/guardians supported by the last 2 years' income tax statements.
   2. Financial Statements: Provide six months' bank statements or recent salary slips.
   3. Course Expenses Plan: Detail your anticipated course expenses comprehensively.
   4. Current Financial Obligations: Disclose details regarding existing loans and any scholarships received.
7. Institute Prospectus: Include a copy of the institute's prospectus to effectively estimate costs associated with the course.

To get your own education loan documents checklist specially customized as per your profile, request a callback from financial officers at WeMakeScholars or fill out the common application form, to start your loan process.

Many aspiring students aiming to pursue studies abroad through KVB loans often lack awareness regarding the types of collateral security accepted by the bank. This article aims to shed light on the acceptable collateral types, not only by KVB but also by other major government banks offering study abroad loans. Understanding these collateral options is crucial for any secured loan application process.

Immovable Property:
Among the frequently pledged assets, immovable properties stand out as a common form of collateral for study abroad loans. These assets include houses, residential flats,  defined plot boundaries, independent houses, non-agricultural lands, and similar properties.

Liquid Security:
Contrary to common belief, government banks such as SBI and BoB accept liquid assets as collateral for study abroad loans. Examples of such assets include Fixed Deposits, government bonds, and life insurance policies from government-approved lenders.

Third-Party's Assets:
In scenarios where candidates lack the aforementioned assets or their value doesn't meet the loan requirements, third-party assets can be pledged as collateral. These third parties, not directly related to the candidate's immediate family, may include uncles, aunts, friends, or primary co-applicants.

If you provide liquid security for an education loan, you may be able to get a loan amount equivalent to 100% of the value of the security. 

NOTE- Commercial property is acceptable, and market value of all the properties is considered instead of realizable value.

(Market Value: If the asset was sold today in the current market, the value it was sold for would be considered the fair market value. 
Realizable Value: The realizable value of a property is the expected selling price of the asset in the future after removing the costs of selling the property.)

Collateral Margin

The collateral margin for Karur Vysya Bank education loan for abroad studies is 100% if the interest is paid during the moratorium period and 90% if the interest is not paid during the moratorium period. 

If you are able to make a Simple Interest payment during the moratorium period, you will be eligible for a higher loan amount. But it is not mandatory to pay.

To apply for KVB education loan, there are following two ways

Offline application process

1. Visit the nearest Karur Vysya Bank’s branch and enquire about the loan products & schemes
2. Check your eligibility and decide the parameters of the education loan, like loan amount, repayment duration, etc.
3. Fill out the loan application form and ask for the document required to start the loan process.
4. Visit the bank again to submit the loan application form and documents
5. Pay multiple visits to the bank to check for the progress of your loan application file.

Online application process

Step 1: Request a callback on WeMakeScholars (we are the official digital partner of KVB), or fill out the loan application form for Karur Vysya Bank

Step 2: You will be assigned a Financial officer, who will pre screen your application

Step 3: Provide your details to your financial officer, to build your loan profile

After analyzing your loan profile, your financial officer will suggest anything which may require related to improvement in your profile 

Step 4: You'll be provided the checklist of documents by your FO and for the verification of documents you'll need to go through a video call 

Step 5: After verification, you'll be given an appointment to submit the hard copies of your documents to the branch. 

Step 6: It takes around 2-3 days for the legal and valuation of your collateral to be done (In the case of a collateralized loan) and 7-8 days for the sanction to be done. 

Step 7: Collect your loan sanction letter from the bank after signing the loan agreement.

If you are processing your KVB education loan through WeMakeScholars, the whole process can be completed in 10 days.

Students who already have a running education loan can apply to transfer their education loan to Karur Vysya Bank, to get the following advantages:

• Lower rate of interest
• The longer repayment period
• Easy repayment options
• Hassle-free repayment conditions
• Good serviceability and customer service
• Wider coverage of loan products

To transfer your education loan to KVB follow the below steps:

Step 1: Ask for the proof of outstanding loan amount from your present lender

Step 2: Get in touch with your financial officer at WeMakeScholars, stating that you want to transfer your education loan to Karur Vysya Bank

Step 3: Submit your documents in KVB as per the documents checklist given by your financial officer

Once your loan transfer is approved, a new education loan of the same outstanding amount will be issued to you from Karur Vysya Bank, which you will have to repay to KVB as per their education loan repayment plan. 

Padho Pardesh Scheme:

Objective: To provide interest subsidies to minority students pursuing master’s, M.Phil, or Ph.D. degrees abroad.
Beneficiaries: Meritorious students from economically weaker sections of notified minority communities.
Purpose: Enhance opportunities for higher education abroad and improve employability.

Update: Discontinued from April 1, 2022. Beneficiaries who applied until March 31, 2022, can continue to avail interest subsidy benefits.

Central Government Interest Subsidy Scheme (CSIS):

Objective: Offer interest subsidy during the moratorium period of education loans for economically weaker sections (EWS) and other backward classes (OBC) students pursuing technical/professional courses in India.
Aim: Provide financial assistance to EWS students for higher education and boost employability.

Dr. Ambedkar Interest Subsidy Scheme for OBC and EWS Students:

Objective: Provide interest subsidy on education loans for overseas studies at the Masters, M.Phil., and Ph.D. levels.
Beneficiaries: OBCs and EBCs students.
Purpose: Support overseas education endeavors by covering interest payable during the moratorium period.