UCO Bank Education Loan

UCO Bank education loans for abroad are offered via two main schemes: UCO Standard Education Loan Scheme (India & Abroad) and UCO Aspire 2.0 (Abroad). The interest rates offered under these schemes are 10.80% - 11.20% under the Standard Education Loan Scheme and 7.75% - 8.50% for Aspire 2.0, depending on the university ranking and collateral. The maximum loan amount under the Standard Education Loan Scheme for studying abroad is ₹20 lakh, and for Aspire 2.0 there is no maximum loan amount, as the amount provided is based on the applicant’s requirement. There are also no processing fees or prepayment/foreclosure charges on the loans offered by UCO Bank, making it a cost-effective option for students who plan to study abroad.

This UCO Bank education loan guide covers loan amounts, interest rates, university list, required documents, application process, comparison tables with other banks, and more.

UCO Bank has two schemes that focus on providing education loans for studies abroad. Here are all the details of both schemes. 

Standard UCO Education Loan (India and Abroad)

The standard education loan offered by UCO focuses on providing education loans for both domestic and overseas studies. The key features of this scheme include no processing fee and simple interest during the moratorium. The maximum loan amount for secured loans under this scheme is ₹10 lakh for India and ₹20 lakh for studies abroad. For unsecured loans, the maximum loan amount offered under this scheme is ₹7.5 lakh, under the Credit Guarantee Fund Scheme for Education Loan (CGFSEL).

UCO Aspire 2.0 Loan Scheme (Abroad)

Aspire 2.0 is a special scheme of UCO that focuses only on education abroad. The key benefits of this scheme are that it allows Non-Resident Indians (NRIs) to apply, has no maximum loan amount, and has no age restriction for the applicant. To be eligible for this scheme, the student must secure admission to a university listed in the Webometrics-ranked universities list (up to 1,500).

How much can you borrow from UCO Bank for studying abroad, and how much do you have to arrange on your own? Here is a breakdown of the loan limit, covered expenses, margin money, and collateral requirements under the Standard and Aspire 2.0 schemes.

Maximum Loan Amount for Studies Abroad and Expenses Covered

The maximum loan amount offered by UCO under its standard education loan is ₹20 lakh for abroad studies and ₹10 lakh for Indian studies. However, the maximum loan amount for Aspire 2.0 is decided based on the need, meaning no maximum or minimum loan amount is specified. The final loan amount offered to you depends on factors such as the co-applicant's income, CIBIL score, the university you opt for, and your total expenditure. Here is the list of all the expenses covered under your loan: 

• Academic costs - Tuition fees, examination charges, lab charges, and any other university-specified expenditure are covered under academic costs.

• Living expenditure - rent, caution/security deposit, building fund, hostel charges, food and grocery charges, basic clothing, Wi-Fi and mobile charges are taken care of by the bank. Note that these expenses (except accommodation) are reimbursed, not disbursed upfront, so keep all your receipts safe for future claims.

• Miscellaneous expenses - insurance, flight charges, public transport charges, and other such costs.

Courses and Degrees Covered Abroad

UCO Bank offers a wide range of eligible courses under its standard education loan scheme. For undergraduate studies, eligible courses are job-oriented professional and technical programs, such as engineering and technology, computer science and information technology, business management, architecture, applied sciences, or other specialised courses. For postgraduate courses, MCA, MBA, and MS are accepted. You are eligible for a UCO Bank education loan only if the university is reputed and ranks well. 

UCO also provides loans for professional courses such as CIMA and CPA. CIMA is a professional course offered in the UK by the Chartered Institute of Management Accountants, and CPA is offered in the US by the American Institute of Certified Public Accountants (AICPA). 

Margin Money

Margin money refers to a share of expenses that the student has to pay from their own funds. This usually consists of a small percentage of the total expenditure. The margin money percentage is set by the bank and varies based on the scheme. This is not a fee paid to the bank; it is your own contribution towards your expenses.

The education loan margin money for abroad studies under UCO Bank is 15%. That means that for every ₹100 expenditure, the bank covers ₹85 and the student pays ₹15. The margin money is usually paid to the bank, after which the bank releases the entire disbursement, including its share of the required amount. 

What If Your Costs Exceed ₹20 Lakh?

The standard education loan offered by UCO only sanctions a maximum loan amount of ₹20 lakh for abroad studies and ₹10 lakh for Indian universities. But a very important question arises: what if your costs exceed ₹20 lakh? This is where Aspire 2.0 comes into play. Under Aspire 2.0, there is no maximum or minimum loan amount. The loan amount is determined by the needs of the student. The eligibility and final interest rates are determined based on the Webometrics-ranking of the university. To get the best interest rate, it is recommended to opt for a top 200-listed university. 

UCO Utkarsh and Udaan Loan Schemes

Utkarsh scheme offered under UCO Bank aims to provide education loans for Indian students to pursue their higher education in India. A wide range of courses is eligible, such as full-time degrees, diplomas, part-time courses, and others. The only condition to secure an Utkarsh education loan is to take admission to a premier institute in India. 

The Udaan scheme follows the same guidelines but is meant for meritorious female students at premier institutions in India.

Note: These schemes do not cover overseas study.

By understanding how interest rates are calculated and what concessions apply to your education loan, your process of understanding of the loan process becomes much easier and more transparent. Here is how the bank calculates your interest and what concessions are offered by UCO Bank for an education loan.

How UCO Bank Education Loan Interest Rate Is Calculated

The education loan interest rate for UCO Bank is calculated based on two factors: the benchmark rate and the spread rate. UCO Bank’s internal Asset Liability Management Committee (ALCO) decides both rates. The committee periodically reviews and revises the benchmark rate. Base benchmark rates such as MCLR (Marginal Cost of Funds-Based Lending Rate) are set under the direction of the RBI by the bank. Over this, the spread covers the bank's operating costs and risk premium and may vary with the student's profile. 

Note: The UCO Bank interest rates for education loans are floating. 

Interest Rates by Scheme 

The interest rates offered under the standard education loan scheme and UCO Aspire 2.0 differ in various ways. Here is a complete breakdown of both schemes' interest rates. 

UCO Standard Education Loan Scheme (Abroad)

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

UCO Aspire 2.0 Education Loan Scheme 

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

Concessions and Tax Benefits

Concessions and tax benefits are a great way to reduce education loan expenses. UCO Bank offers two types of concessions, and under Section 80E, you can claim a tax deduction; the details are listed below.

Interest Rate Concession - 

• Girl Child Concession: UCO Bank offers a 0.10% concession on the applicable rate of interest for female applicants.

• Employee Child Concession: For children of UCO employees, the bank offers a 0.15% concession.

Tax Benefit - 

Under Section 80E, the applicant or co-applicant can claim a 100% deduction on interest paid. This education loan tax benefit is available only under the old tax regime, for up to 8 consecutive years. 

Every bank has a list of eligibility criteria that the applicant and the co-applicant have to meet in order for the application process to begin. In the case of UCO Bank, the eligibility for the student and co-applicant is listed below, along with a list of eligible courses listed by the bank. 

Student Eligibility and Age Limits

• Eligibility Criteria - 

For Standard Education Loan Scheme 

1. Must be an Indian citizen 

2. Must have secured admission in the chosen university 

3. Must have completed 10+2 or equivalent qualification 

For Aspire 2.0 Education Loan Scheme 

1. Should be an Indian citizen or NRI

2. Secured admission in the selected university 

• Age Limit - 

For the Standard Education Loan Scheme, the age limit is: 

Under the Standard Education Loan Scheme, the maximum age limit depends on the course level and your category:

• Undergraduate courses: Up to 28 years for general candidates and up to 30 years for SC/ST candidates.

• Post-graduate courses: Up to 30 years for general candidates and up to 33 years for SC/ST candidates.

For the Aspire 2.0 Education Loan Scheme, there is no age restriction.

Co-Applicant Requirements

1. Stable Income - For both secured and unsecured education loans, the co-applicant's stable income is mandatory. This is one of the factors considered when finalising the interest rate and, often, the loan amount.

2. Good CIBIL Score - A good CIBIL score for an education loan is essential for loan approval; a score of 700 or above is considered good. 

3. Documents - The co-applicant is required to have all their income sources documented, as banks have a list of income/financial documents that they require to process the loan. 

Eligible Courses Abroad

Under the Standard scheme, only courses on the bank’s approved list are eligible. Confirm your course with the bank before applying 

For Aspire 2.0, there are no course limitations. Students can choose any course they intend to pursue. 

Under UCO Aspire 2.0, the interest rates are decided based on the university ranking. UCO Bank uses the Webometrics ranking of the World Universities. This ranking system is based on university web presence, visibility, and web access. Webometrics ranks more than 31,000 universities worldwide. You can find the college list on the official Webometrics ranking page. 

Will you need to pledge security for your UCO Bank education loan, and how much do you have to pay from your own pocket? Here is how collateral, margin money, and the Credit Guarantee Fund (CGFSEL) work for different loan amounts.

When Is Collateral Required? 

For loans above ₹7.5 lakh, collateral is mandatory, and a parent must be the co-applicant.

Credit Guarantee Fund (CGFSEL) 

CGFSEL stands for Credit Guarantee Fund Scheme for Education Loan. It is a Government of India scheme launched in September 2015. The core objective of this initiative is to enable collateral-free and third-party guarantee-free higher education loans up to ₹7.5 lakh. Under this initiative, the Government of India works with public and private banks to provide these loans to eligible students. 

Margin Money by Loan Amount

The margin money of UCO Bank for abroad education loans is 15%.

Various documents are required to start your education loan process. The documents can mainly be divided into: KYC documents, academic documents, income documents, collateral documents and other essential documents. Here is a detailed list of all the documents required for your application.

Applicant and Co-Applicant Documents

Collateral Documents 

These are some of the basic collateral documents required for immovable assets and liquid assets. 

Property documents for residential and commercial properties: 

1. Sale agreement/Chain agreement

2. Occupancy Certificate (OC), Commencement Certificate (CC), or sanctioned plan approval

3. Latest maintenance receipt; latest utility bill

Liquid securities:

1. Fixed Deposits - principal value certificate

2. Insurance - surrender value certificate and policy papers 

3. Government Securities - face value certificate and policy papers

These are some of the most popular liquid security documents. Each type of collateral has its own list of required documents; check with your bank before applying for an education loan.

Extra Documents for Abroad Loans

1. Admission letter - To begin your education loan process at UCO, you are required to have an admission letter from the university. You can start your loan process with UCO Bank even with a conditional offer letter from the university.

2. Fee Schedule - The bank needs the fee structure or breakdown to assess the total expenditure.

You can apply for a UCO Bank education loan mainly via two methods: one is through the bank, which offers both online and offline application facilities, and the other is via WeMakeScholars. Both application steps are mentioned below.

Apply via Bank: Online and Offline

Online Mode: 

1. Go to the official UCO Bank education loan page

2. Choose your loan scheme and click Apply Now

3. Fill out all the required information and submit the form

Offline Mode: 

1. Visit the nearest branch and request a UCO Bank education loan form

2. Fill out the required details on the application form

3. After filling out all the details, attach the required documents and submit the UCO Bank education loan form.

The bank executive will contact you to process your application further.

Apply via WeMakeScholars and its benefits 

Application process:

1. Visit the WeMakeScholars website.

2. Click on the “Check Eligibility” form.

3. Fill out the form and submit it. 

Soon, a financial officer will connect with you and tailor the best plan for you based on your needs and profile. 

Benefits of going via WeMakeScholars: 

WeMakeScholars is an organisation created with the sole purpose of supporting students pursuing their education abroad. Here are some of the key benefits of WeMakeScholars.

• Better offers: We are partnered with 20+ banks and NBFCs, so your profile is evaluated by multiple lenders, and you can compare offers.

• Faster Loan Process: Loans applied through WeMakeScholars are processed within days.

• End-to-End Support: From checking your eligibility with various banks to providing post-loan sanction support, WeMakeScholars supports you in the entire loan process. 

• Cashback: Students processing their education loan via WeMakeScholars receive a cashback of up to ₹3,000 on their first disbursement. 

Processing Time

There are two ways to track your UCO Bank education loan application status. 

1. UCO Bank website

2. UCO Bank branch where the application was submitted

For the UCO Bank website, you can start by visiting the official website of UCO Bank and opening the Track Your Application section. Enter the required application/reference details and submit it. Your current loan status should appear on the page. 

You can also visit the bank branch directly and provide the bank executive with your application number and basic details about your application, after which they will check your current loan status and inform you of the status.

Disbursement, moratorium, and repayment are some of the most important elements of an education loan process. By understanding how they function, students can make informed decisions about their loan application.

How Disbursement Works 

Education loan disbursement refers to the portion of your sanctioned amount being paid towards your expenditure. There are multiple types of expenditure, and each is disbursed differently. For academic expenditure such as tuition fees, the bank disburses the fees directly to the university. 

Living expenses are reimbursed. The student submits receipts to the bank, and after verification, the amount is credited to the student's account. There are some exceptions to this; rent/hostel charges are disbursed on a set date. 

Interest During Moratorium

The education loan moratorium period refers to the grace period during which EMIs don't start. UCO offers a moratorium period of the course duration plus 1 year after your course completion. During this period, simple interest is charged at monthly intervals. Paying this interest during the moratorium is optional.

Repayment Tenure

The education loan repayment tenure refers to the repayment duration, which starts after the moratorium, when EMIs begin.

The repayment tenure offered by UCO Bank for its education loan is up to 15 years. You pay a fixed EMI on a set date every month, made up of principal and interest. This ultimately clears your entire borrowed amount. 

Prepayment and Foreclosure

Prepayment is divided into two types: part-payment and foreclosure. In part-payment, you pay a lump sum over your regular EMI; the entire extra amount that is paid over the regular EMI goes towards your principal. This reduces your principal amount, hence reducing your EMI. Foreclosure refers to paying off the entire loan before the end of your repayment tenure. 

In the case of UCO Bank, no prepayment or foreclosure charges are levied, making it easier for applicants to prepay their loan.

Let's understand how your EMI would work out based on the repayment, moratorium, and interest rate information given above. For example, you take a ₹20 lakh education loan for your 2-year master’s programme and repay it over 15 years. You are charged simple interest during the moratorium, and you don't pay it during that period. Here is your monthly EMI under each scheme. 

Disclaimer: Figures shown are illustrative examples only. Actual figures may vary based on applicable loan terms and conditions. 

To understand your education loan EMI calculation further, you can use the UCO Bank calculator or the WeMakeScholars EMI calculator.

An education loan processing fee refers to the charge levied by the bank on the applicant for processing the loan application. Here is a breakdown of UCO Bank’s charges.

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

Several reasons can delay or lead to rejection of your application. By understanding those reasons, you can avoid making those mistakes and get a faster and hassle-free education loan from UCO Bank. Here is a list of common issues. 

1. Missing Documents - Your application only starts after all the required documents are submitted. Until all the documents are submitted, banks won't start your application process, which leads to delays. It is always best to check the full document checklist before applying. 

2. Course or Institution Does Not Meet the Scheme Criteria - UCO Bank has a list of acceptable courses and institutions. To check the course criteria, check the bank’s official website or contact the bank directly. To check institution eligibility, you can visit the Webometrics-ranking official website. The institution criteria are explained in the college list section above.

3. Problems With Collateral - Multiple property-related issues can slow down the process or even cause rejection. Some of the main reasons are a mismatch with the bank’s requirements, incomplete property papers, difficulty establishing the property’s value, and ownership issues.

4. Applicant or Co-applicant Doesn't Meet Eligibility - Some of the most common applicant and co-applicant eligibility issues are: age limits, insufficient co-applicant income, and poor credit history.

Under the right scheme, UCO Bank can be a great option for students who plan to study abroad. The Standard UCO Education Loan Scheme offers a loan up to ₹20 lakh for studying abroad, and under Aspire 2.0, there is no maximum loan amount and no course or age restriction. The bank also offers concessions to employees' children and female students who take their loan via UCO Bank. UCO Bank’s zero processing fee and no prepayment or foreclosure charges suit students who want to close the loan early. Compare banks and check your eligibility with WeMakeScholars to find the best plan.