Education Loan in Tamil Nadu

✓ Education Loan up to 2 Cr

✓ Featuring an interest rate as low as 8.30%

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Table of content

  1. Best banks for Education Loan in Tamil Nadu
  2. Education Loan Interest rate in Tamil Nadu
  3. Other Education Loan features offered by Banks or NBFCs in Tamil Nadu
  4. Documents required for availing an Education Loan in Tamil Nadu
  5. Common reasons for Education Loan rejection in Tamil Nadu
  6. Why Choose WeMakeScholars for an Education Loan in TamilNadu?
  7. Repayment plan for Education loans in Tamil Nadu
  8. Education loan subsidy schemes applicable to students from Tamil Nadu
  9. Higher Education in Tamil Nadu
  10. FAQ's
  11. Need Help? Ask Here!

If you are a student in Tamil Nadu who is considering taking out a loan to finance your education in Tamil Nadu or anywhere else in India or abroad, this information will definitely be useful for you. According to data, the average education loan amount required by students in Chennai, Coimbatore, or Madurai for studying within India is approximately INR 15 lakhs, and for studying abroad it is around INR 45 lakhs. Education loan interest rates in Tamil Nadu range from 8.5% to 13%, depending on the type of loan and the lender. Further information is provided below. 

Best banks for Education Loan in Tamil Nadu

For studies in India: 

Bank Name

Scheme Name

Loan amount- Collateral Required

Processing fee

SBI

SBI Scholar Loan Scheme 

Upto 1.5 Crores with collateral 

10K + GST 

BOB

Baroda Education Loan to Students of Premier Institutions

Depends on the university

10K + GST 

Karur Vysya Bank

Education Loan Scheme 

Upto 1.5 Crores with collateral 

10K + GST 

Union Bank

Union Bank India Education Loan

Upto 2 Crores with collateral 

1-2% of the loan amount 

Axis Bank

Education loan for study in India

Upto 40 Lakhs unsecured 

1-2% of the loan amount 

ICICI Bank

Education loan for study in India

Upto 50 Lakhs unsecured 

1-2% of the loan amount 

IDFC First Bank

Education loan for study in India

Upto 50 Lakhs unsecured 

1-2% of the loan amount 

Avanse

Education loan for studying in India 

Upto 60 Lakhs 

1-2% of the loan amount 

Incred

Education loan for studying in India 

Upto 60 Lakhs 

1-2% of the loan amount 

Auxilo

Auxilo education loan for studying in India 

Upto 60 Lakhs 

1-2% of the loan amount 

Credila

Credila education loan for studying in India 

Upto 60 Lakhs 

1-2% of the loan amount 

 

For Foreign studies:

Bank Name

Scheme Name

Loan amount- Collateral Required

Processing fee

SBI

SBI Scholar Loan Scheme 

Upto 1.5 Crores with collateral 

10K + GST 

BOB

Baroda Scholar 

Upto 1.5 Crores with collateral 

10K + GST 

Karur Vysya Bank

Education Loan Scheme 

Upto 1.5 Crores with collateral 

10K + GST 

Union Bank

Union Bank Abroad Education Loan

Upto 1.5 Crores with collateral 

1-2% of the loan amount

Axis Bank

Education loan for studying abroad 

Upto 40 Lakhs unsecured 

1-2% of the loan amount 

ICICI Bank

Education loan for studying abroad 

Upto 50 Lakhs unsecured 

1-2% of the loan amount 

IDFC First Bank

Education loan for studying abroad 

Upto 40 Lakhs unsecured 

1-2% of the loan amount 

Avanse

Education loan for studying abroad 

Upto 75 Lakhs for studying abroad

1-2% of the loan amount 

Incred

Education loan for studying abroad 

Upto 75 Lakhs for studying abroad

1-2% of the loan amount 

Auxilo

Education loan for studying abroad 

Upto 75 Lakhs for studying abroad 

1-2% of the loan amount 

Credila

Credila education loan for studying abroad

Upto 75 Lakhs for studying abroad

1-2% of the loan amount 

 

Get your education loan with the best interest rates and repayment policies.

Education Loan Interest rate in Tamil Nadu

For studies in India:

Bank Name

Interest rate

Interest rate concession

SBI

Starts from 8.35% 

0.50% - for female students 

0.50% - Rinn Raksha

BOB

Starts from 10.60%

upto 2%

Karur Vysya Bank

Starts from 10%

upto 2%

Union Bank

Starts from 11.15%

0.5% for female students

1% if the SI is paid in full 

Axis Bank

Starts from 11%

up to 2%

ICICI Bank

Starts from 10.5%

up to 2%

IDFC First Bank

Starts from 8.5% 

up to 2%

Avanse

Starts from 11% 

up to 2%

Incred

Starts from 11% 

up to 2%

Auxilo

Starts from 11% 

up to 2%

Credila

Starts from 11% 

up to 2%

 

For Foreign studies:

   Bank Name

Interest rate

Interest rate concession

SBI

Starts from 8.35% 

0.50% - for female students, 

0.50% - Rinn Raksha

BOB

Starts from 10.60%

up to 2%

Karur Vysya Bank

Starts from 10%

up to 2%

Union Bank

Starts from 11.15%

0.5% for female students

1% if the SI is paid in full 

Axis Bank

Starts from 11%

up to 2%

ICICI Bank

Starts from 10.5%

up to 2%

IDFC First Bank

Starts from 8.5% 

up to 2%

Avanse

Starts from 11% 

upto 2%

Incred

Starts from 11% 

up to 2%

Auxilo

Starts from 11% 

up to 2%

Credila

Starts from 11% 

upto 2%

 

We offer personalized education loan solutions that are customized to your needs and requirements.

Other Education Loan features offered by Banks or NBFCs in Tamil Nadu

Expenses covered:

In India, education loans are generally taken to pay for tuition fees, examination fees, and other educational expenses like hostel fees, books, and equipment. Some loans may also include living expenses like housing and food. It's important to carefully read the terms and conditions of the loan to understand what costs are covered. The lender may have specific requirements or restrictions on how the loan can be utilized.  

Moratorium Period:

The moratorium period is a time frame in which the borrower is not required to make any payments on their loan. The length of the moratorium period can vary based on the lender and the terms of the loan, and is typically between 6 and 12 months after completion of the course.

Loan Margin:

The loan margin is the percentage of the total loan amount that the borrower is required to pay out of their own pocket. For example, if the loan margin is 5%, the borrower would be required to pay 5% of the total loan amount as their own contribution, and the lender would cover the remaining 95%. The loan margin is often used by lenders to reduce their risk in case the borrower is unable to make the loan repayments. It is important to carefully read the terms and conditions of the loan to understand the loan margin and any other conditions that may apply. 

Collateral Margin:

A collateral margin is a percentage of a loan that is backed by an asset that the borrower puts up as security in case they can't repay the loan. If the borrower defaults on the loan, the lender can take the collateral to cover their losses. Lenders often require a collateral margin to reduce their risk. It's important for borrowers to carefully review the terms of their loan, including any collateral margin requirements, before accepting the loan.

Documents required for availing an Education Loan in Tamil Nadu

Documents required for Unsecured Loan in TamilNadu

Application form:

A loan application form requires a borrower to submit two photos and a signed form, as well as information from their financial officer, in order to be considered for a loan.

Student Documents:

  • Identification documents: Aadhar card, PAN card, and passport of the applicant 
  • Admission letter from a university
  • Utility bills: electricity bill, house tax
  • Academic documents: 10th, 12th, degree/diploma
  • Scores from competitive exams: IELTS, TOFEL, GRE, GMAT
  • Gap certificate for any gaps between degrees
  • Work experience letter, if applicable

Co-applicant Documents:

  • In addition to identification documents, financial documents are also required.
  • For salaried individuals: last 3 months of salary slips, 6 months of bank statements, company ID, last 2 years of Form 16, last 2 years of ITRs
  • For self-employed individuals: last 3 years of ITRs, 6 months of bank statements, balance sheet, profit, and loss account for last 3 years, proof of business address

Other Documents:

  • A letter stating that the co-applicant is responsible for any remaining costs not covered by the loan (format provided by assigned financial officer)
  • A manifested standard bank statement with both the student and co-applicant
  • An invoice for expenses such as travel or a laptop, if a loan is being requested to cover these items
  • Receipts for any transactions made in advance
  • Loan statements from the previous year, if applicable
  • A letter explaining any gaps in employment or income, on Rs. 100 stamp paper
  • A letter explaining the lack of a co-applicant's income tax return, if relevant

Documents required for Secured Loan in TamilNadu

In addition to the documents required for an unsecured loan, a basic income certificate for the co-applicant may be required if they do not have income tax returns (ITRs). A secured loan also requires additional papers to serve as proof of the collateral being pledged.

Additional Documents for Secured Loans for TamilNadu

  • The title deed and patta (a document that grants ownership rights over land) for the property being used as collateral must be provided.
  • A registered sale agreement, gift deed, or will that establishes ownership of the property must be presented.
  • The original receipt for the ownership-establishing document listed above must be provided.
  • An allotment letter from a government authority such as Manai Patta, with DTCP for Coimbatore, Madurai, Tiruchirappalli, Salem, and CMDA approvals for Chennai, must be presented.
  • 30 years' worth of documents showing the transfer of ownership of the property or earlier chain of sale deeds that establish ownership, including an extract of the controlled document (EC), must be provided.
  • The latest property tax bill and latest electricity bill with the same address as the property must be presented.
  • A copy of a municipality-approved building plan or plot layout for the property must be provided.

Acceptable collaterals in TamilNadu for education loans

  1. Generally, banks in Gram Natham do not accept properties without a patta and building plan approval for an independent house, but SBI now does if the property has a patta. If it is flat, only a patta is required. Bank of Baroda will accept a property with Manai Patta and DTCP or CMDA approval. Patta is a mandatory document for properties in Tamil Nadu.
  2. Commercial properties are accepted by private banks but the collateral margin varies considerably less than residential properties. If a property does not have building plan approval and the land value is low, it may be better to consider other collateral or third-party collateral options.
  3. It is allowed to use agricultural land as collateral for education loans in Tamil Nadu. However, it is important to note that different banks and financial institutions may have their own specific requirements and restrictions regarding the use of agricultural land as collateral and for non-agricultural lands, demarcations (boundary markings) are not mandatory.  
  4. FD(Fixed Deposit), Insurance policies, and government bonds are accepted according to their type. For example, the principal value of the FD is considered and the surrender value is considered for insurance policies, face value for government bonds, and the collateral margin is quite higher than other properties.
Let us help you navigate the education loan process for studying with our fast and reliable service.

Common reasons for Education Loan rejection in Tamil Nadu

If you are planning to apply for a secured loan from a government bank in TamilNadu, it is important to note that you will need to provide a Patta, an individual property document, as part of the application process. A Kotu Patta is not acceptable. Additionally, the property must have the necessary approvals, such as CMDA in Chennai or DTCP in Coimbatore, Madurai, Tiruchirappalli, and Salem, in order to be eligible for a secured loan. It is also important to be aware that collaterals that are not constructed according to the approved building plan may result in an FSI deviation, which will be evaluated by the bank in accordance with their terms and conditions.

For unsecured loans, it is common for the CIBIL score of the co-applicant, such as a parent, to be a factor in loan approval. Most banks require a CIBIL score of at least 685 and do not accept applications from individuals with major issues with their credit histories, such as loan defaults or settlements. It is advisable to check the co-applicant's CIBIL score in advance and address any potential issues before applying for a loan. 

Why Choose WeMakeScholars for an Education Loan in TamilNadu?

Relationship Manager:

If you are obtaining a secured education loan, WeMakeScholars will assign you a relationship manager who will assist you with the process and help expedite it.

Rate of Interest Negotiation:

Unsecured loans generally have higher interest rates, but WeMakeScholars may be able to negotiate a reduction in the rate by a minimum of 1-2% for you.

Government Funding:

WeMakeScholars is a government-supported organization that receives funding from the Indian government's Ministry of IT under the Digital India campaign.

Experience in Complex Cases:

On a daily basis, we handle many complex cases involving multiple parties that need to be resolved promptly. We have a history of successfully issuing sanctions in even the most difficult case

No Service Charge:

WeMakeScholars is a free service for students and provides assistance until the loan is fully repaid.

Transparency:

WeMakeScholars provides students with comprehensive information about the loan application process and ensures that they fully understand each step before proceeding with the loan.

Cashback Provided:

Students who use WeMakeScholars to apply for a study abroad loan will receive a cashback on their first disbursement, with a maximum amount of INR 3000.

With our education loan service, you can be sure that you're getting the best education loan.

Repayment plan for Education loans in Tamil Nadu

After the moratorium period, you will need to begin making monthly payments on an unsecured education loan with a repayment term of 10 years.

For example, if a student takes out a loan of INR 35 lakh at an interest rate of 11.25% over a 10-year period, the student will be required to pay back the loan according to the following payment plan:

Repayment schedule

EMI

Interest portion

Loan Outstanding

Principal portion

End of 1st year

58684

37462

21222

3974695

End of 2nd year

58684

34947

23737

3703962

End of 3rd year

58684

32135

26549

3401152

End of 4th year

58684

28989

29695

3062462

End of 5th year

58684

25471

33214

2683643

End of 6th year

58684

21535

37149

2259938

End of 7th year

58684

17134

41550

1786031

End of 8th year

58684

12210

46474

1255972

End of 9th year

58684

6704

51980

663109

End of 10th year

58684

545

58139

0

 

Don't let the stress of education loan applications stand in the way of your dream of education.

Education loan subsidy schemes applicable to students from Tamil Nadu

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

The Ministry of Social Justice and Empowerment launched this program to provide a reduction in the interest payments due during the temporary suspension of payments period for education loans taken out by students from the OBC and EBC sections of society.

Eligibility:

  • The student must have been accepted into a masters, M.Phil, or PhD program abroad
  • The student's family income must be less than INR 8 lakh per year for both the EBC and OBC categories
  • A caste certificate is required for students in the OBC category
  • Only loans taken from scheduled banks as per Indian Banking Association guidelines are accepted.

Benefit: The interest payments that would be due during the temporary suspension of payments period of the loan will be waived.

Padho Pardesh Scheme

The program was introduced by the Ministry of Minority Affairs to help individuals from EWS (Economically Weaker Section) communities who wish to study abroad.

Eligibility Criteria for the Padho Pardesh Scheme

  • Loans must be taken from scheduled banks according to Indian Banking Association guidelines.
  • Students must be accepted into programs such as masters, Ph.D., or M.Phil.
  • A government-approved certificate of income is required.
  • The student's family income must be less than INR 6 lakh per year.

Note: The Padho Pardesh scheme, which was run by the government of India, has been discontinued as of March 31, 2022. However, students who were eligible and registered for the program before April 1, 2022 will still receive benefits from it.

Central Scheme for Interest Subsidy (CSIS)

The Ministry of Human Resource Development (now known as the Ministry of Education) created the program to offer waivers on the interest payments for student loans taken by individuals from the EWS (Economically Weaker Section) of society.

CSIS Eligibility Requirements

To be eligible for the program, students must provide proof of their membership in the EWS (Economically Weaker Section) of society. They must also be accepted into an approved study program within India, and their family's annual income must not exceed 4.5 lakh rupees. Under the program, qualifying students who took out loans to study in India during the temporary suspension of payments period are exempt from paying interest on their loans.

Benefit: Under the Central Scheme for Interest Subsidy (CSIS), students who meet the eligibility requirements and took out loans to finance their education in India during the temporary suspension of payments period are eligible to have the interest on their loans waived.

Higher Education in Tamil Nadu

There are several reputable institutes in Chennai, Coimbatore, Madurai,Tiruchirappalli, and Salem.That offer a wide range of courses, including engineering, medical, and degree programs. Here are some of the top reputed universities in Tamil Nadu.

  • IIT Madras, Chennai
  • CEG Anna University, Chennai.
  • CMC Vellore, Vellore.
  • NIT Trichy, Tiruchirappalli.
  • Tamil Nadu Agricultural University - [TNAU], Coimbatore. 
  • Loyola College, Chennai. 
  • Sri Ramachandra Institute of Higher Education and Research, Chennai.
  • Presidency College, Chennai.
  • VIT Vellore, Vellore.
  • SRM University, Chennai.

Education Loan FAQs

  • How to get an education loan in Tamil Nadu?

    There are several banks and financial institutions in Tamil Nadu that offer education loans to students who wish to pursue higher education in India or abroad. To apply for an education loan in Tamil Nadu, Visit WeMakeScholars and request for a callback.

  • Which bank provides an education loan easily?

    There are several banks in India that offer education loans to students who wish to pursue higher education in India or abroad. Some of the banks that are known to provide education loans include the SBI, BOB, PNB, and Canara Bank but the process in these banks is pretty hectic, and to avoid that request a callback to WeMakeScholars.

  • Can I get a 100% education loan?

    It is possible to obtain a full education loan, and WeMakeScholars can assist you with obtaining one based on your profile. There may be some loan margin, but it is still possible to secure a full loan with the help of WeMakeScholars.

  • Can I get an education loan without parents?

    It is generally necessary to have a co-borrower, such as a parent or guardian when applying for an education loan.However WeMakeScholars can help you get an education loan without the involvement of parents.

  • Who is eligible for an education loan?

    To be eligible for an education loan in India, you must be a citizen of India and have been offered admission to a recognized educational institution in India or abroad. You will also need to have a co-borrower, such as a parent or guardian, who will be responsible for repaying the loan.

  • Which bank is best for an education loan?

    Banks offer various financial products that may or may not be appropriate for your needs. If you select an unsuitable product, you could end up paying a high-interest rate. However, you can avoid this situation by requesting a callback from WeMakeScholars

  • What documents are required for an education loan?

    The documents required for an education loan in India may vary depending on the bank or financial institution you are applying to, as well as your individual circumstances. To get a brief list of documents for your profile, request a callback to WeMakeScholars.

  • Can I get an education loan without a salary slip?

    To apply for an education loan, you will typically need to provide proof of income for the co-borrower, such as salary slips, tax returns, or bank statements. However, WeMakeScholars can help you get an education loan even without the salary slips.

  • Is property required for an education loan?

    Some banks and financial institutions may require you to provide collateral when applying for an education loan.However, not all banks require collateral for education loans. Some banks may allow you to apply for an education loan without collateral, And you can also provide a third-party guarantee, such as a letter of undertaking from a family member or friend

  • How do I repay my education loan?

    There are several ways to repay an education loan in India, depending on the terms and conditions of the loan such as EMI, Foreclosure, and part repayment. And WeMakeScholars will continue to extend support throughout your repayment period.

NEWS

Virudhunagar (Tamil Nadu) Allocates ₹4.11 Crore for Education Loans in Student Support Fair

Virudhunagar district's administration has allocated ₹4.11 crore in education loans for 91 students in a recent student aid initiative. These loans were granted during an education loan fair, emphasizing the district's commitment to facilitating higher education access.

Collector V.P. Jayaseelan personally handed out the sanction orders during the event, which received 114 loan applications amounting to ₹4.88 crore.

Jayaseelan stressed that economic constraints should not hinder students' pursuit of higher education. These loans, offered through nationalized and private banks, cover tuition, college, and hostel fees.

The fair aimed to streamline the loan application process, offering guidance and prompt fund disbursal. Students also registered via the www.vidyalakshmi.com portal.

Lead Bank Manager Pandiselvan and other officials played vital roles in organizing the event. The Collector announced that students who missed it could participate in upcoming fairs in October and November.

Virudhunagar's proactive approach highlights the importance of eliminating financial barriers to education.

Last Updated - 25/09/2023

Our Education Loan team will help you with any questions

Naresh Kumar
WeMakeScholars- supported by IT Ministry, Govt. of India.
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