PNB Education Loan Interest Rate 2026

PNB education loan interest rates start at 8.10% p.a. for studies abroad. The bank uses the Repo Linked Lending Rate (RLLR) as its external benchmark and the Business Strategic Premium (BSP) to determine the rates. The final rate is then set based on the loan amount, collateral, and the university category. Concessions can reduce the rate as well.

Punjab National Bank’s Udaan scheme offers education loans for students with plans to study abroad. The current starting rate for PNB’s Udaan scheme is 8.10% p.a. Education loan interest rates at PNB under the Udaan scheme vary by university category, loan slab, and whether you’re a female applicant. 

Top 50 universities - Secured Loan (100% collateral required)

*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. 

Other Universities - Secured Loan (100% collateral required) 

*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. 

Up to ₹7.5 lakh - Unsecured Loan (under CGFSEL)

PNB automatically registers your loan under the CGFSEL (Credit Guarantee Fund Scheme for Education Loans) when you ask for a loan amount of up to ₹7.5 lakh. Education loans under this amount do not require you to pledge any collateral.

The loan margin, i.e., the amount you have to contribute towards your abroad education expenses, further depends on the exact loan amount. No margin is charged for abroad loans up to ₹4 lakh, whereas a 15% margin is applied to loans above ₹4 lakh.

*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. 

Courses in Medicine - Secured 

Students planning to pursue medical courses such as MBBS/MD/MS/PG can avail an 8.10% p.a. floating education loan interest rate at PNB. This is only applicable when the loan amount is more than ₹7.5 lakh. 

Under the Udaan scheme, the RLLR and BSP rate determine the PNB education loan interest rates, effective from 1st July, 2026.

RLLR + Spread Explained (Why Some Sites Quote MCLR)

The RLLR is PNB’s benchmark lending rate linked to the RBI’s repo rate on which the bank offers its loans. It consists of the repo rate (5.25%) plus a mark-up price (2.50%). Additionally, a BSP (Base Spread Rate) of 0.35% is also added, resulting in an applicable starting interest rate of 8.10%. Your borrowing cost is directly affected by the RBI’s repo rate policy.

Interest Rate = RLLR (repo rate + mark-up) + BSP 

The MCLR (Marginal Cost of Funds-based Lending Rate) is the internal benchmark lending rate, which is periodically revised at PNB. The MCLR framework applies to individuals who took education loans from PNB before the year 2019. The MCLR framework does not apply to education loans taken after it.

Simple Interest During Moratorium vs. After

Simple interest (SI) is charged monthly on the disbursed loan amount, but it is not mandatory to pay during the moratorium (course duration + 1-year grace period). After the moratorium, the PNB education loan interest begins to compound. 

The following two situations can impact your monthly EMIs: 

• If You Choose Not To Pay SI: PNB calculates simple interest every month. At the end of the moratorium, the accumulated interest is added to the principal loan amount. After this period, compound interest is charged on the cumulative principal. Your payable EMI will be calculated on the updated loan balance.

• If You Choose To Pay SI: In this case, the applicants get a 1% interest concession when the accruing SI is paid while studying. Since there is no capitalisation, the interest does not accumulate to the principal amount. Thus, your EMIs will be relatively lower. 

The PNB Udaan scheme includes certain concessions to ease the burden of interest rate obligations:

• Concession for Female Students: The PNB student loan interest rate has a 0.5% concession that applies to female students. However, this concession only applies to non-premium universities or when opting for an unsecured loan. 

• Interest Servicing Concession: This is a 1% concession that applies when you choose to pay the interest that accrues during the moratorium.

• Concession for Top 50 Universities: While this is not a separately labelled concession, you secure lower education loan interest rates at PNB when your universities fall under the top 50. 

The following is a worked example for a ₹20 lakh education loan under the PNB Udaan scheme. Get an understanding of the approximate values of the payable EMI and interest at the rates and different repayment tenures given below:

*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. 

The PNB education loan interest rate calculator considers your loan amount, repayment tenure, and interest rates to give you your payable EMI and interest. However, the exact EMI and interest values also depend on your course’s duration, whether you’ll be paying anything during the moratorium, and the grace period. Check out our education loan EMI calculator to get your estimated figures.

PNB’s education loan for abroad interest rates change according to the RBI’s repo rate and the benchmark framework it uses. Besides that, the total interest rate is also dependent on the following factors:

• University Category: Your interest rate is determined based on whether your university falls under the top 50 category. Applicants can receive lower PNB interest rates on an education loan starting at 8.10% p.a. 

• Loan amount and Collateral: PNB Bank’s education loan interest rates depend on whether you take a loan amount up to or above ₹7.5 lakh. Loans up to ₹7.5 lakh do not require collateral; hence, PNB sets a higher markup rate to balance the risk of no collateral. For loans above ₹7.5 lakh, PNB requires 100% collateral security, which prompts them to lower the interest rates.

• Co-applicant profile: Education loan at PNB for abroad interest rates may be influenced by a co-applicant's clean credit history and repayment record.   

• Gender: An interest concession applies to female students taking admission outside the top 50 universities category. 

You can avail lower interest rates through PNB’s Udaan scheme in the following ways:

1. Choose a Secured Loan: Secured loans have relatively lower PNB interest rates on education loans than unsecured loans.

2. Check for Female-Student Concessions: If you are a girl student, you are eligible for the 0.50% interest rate concession. 

3. Check Your University Category: Taking admission to one of the top 50 universities also has low rates. 

4. Consider Paying Interest During Moratorium: If you choose to pay simple interest during the moratorium, PNB awards you a 1% concession on your interest balance that accumulates during that period. 

While PNB Bank education loan interest rates are competitive, with useful concessions to reduce your interest rate, WeMakeScholars can unlock better offers tailored to your profile. Through our partnerships with leading NBFCs and public and private banks, you can avail more features with flexible terms. Talk to a dedicated education loan expert at WeMakeScholars to get the best deal.

The PNB education loan interest certificate is crucial to claim the 80E tax deduction on the interest on your education loan. This certificate serves as proof of the amount paid towards the interest and is required every financial year. 

You can download your interest certificate by logging in to the PNB One App or via PNB net banking using your credentials.

Moreover, you can also calculate your loan’s 80E income tax benefits instantly using our free education loan tax 80E rebate calculator. 

PNB offers funding options that vary by your university category and preferred loan amount. But if you’re wondering about your options with other public banks, here is a full comparison of their interest rates with PNB’s:

*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. 

PNB Bank’s education loan interest rates are ideal for students admitted to top-listed universities, with interest rates starting as low as 8.10% p.a. Along with its specialized concessions, the PNB Udaan scheme provides a versatile funding structure. However, the strict loan cap on PNB’s unsecured option and full collateral requirement for larger amounts can be a hurdle for students seeking larger amounts without collateral. This is where WeMakeScholars can help you overcome these limitations and explore alternative lenders offering broader loan features. Check your eligibility to unlock such deals tailored to your profile.