PNB Education Loan: Schemes, Eligibility, Documents and How to Apply

PNB education loans have several specialised schemes designed for students pursuing their studies in India and abroad. Many of these schemes offer flexible loan amounts based on requirements, meaning a rigid maximum loan limit does not exist. However, a threshold of ₹7.5 lakh exists for a few unsecured loans. The education loan interest rates in India start as low as 7.10% for domestic study, and from 8.35% for abroad loans.

Punjab National Bank Education Loans are intended to help students achieve their international education dreams. With competitive interest rates and flexible repayment options, PNB ensures a smooth funding process for higher studies abroad. In this guide, we will discuss all the PNB education loan schemes, with major emphasis on the abroad education loan schemes.

One of the flagship PNB education loan schemes for studying abroad is PNB Udaan, alongside other domestic loans tailored to different purposes. Additionally, the concessional education loan scheme for PWDs (Persons with disabilities) also finances international studies. The rest of the schemes provide education loans for higher studies within India.

The table below gives a quick overview of all PNB education loan schemes - their interest rates and loan amounts:

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

The Udaan scheme exclusively offers PNB education loans for higher studies abroad. Alongside tuition, the scheme covers a wide range of expenses, including living, transport, life insurance, equipment, computer, and caution deposit. Other course-related expenses such as study tours, thesis, uniforms, and exam fees are also included. 

There is no specific upper limit for the loan amount, as many PNB education loans are offered for the required loan amount. However, loan amounts above ₹7.5 lakh require 100% of the amount as collateral. But loans under the ₹7.5 lakh cap are covered by the CGFSEL (Credit Guarantee Fund Scheme for Education Loans) and thus do not require collateral.

For PNB education loan eligibility, the applicant must fulfil the following:

Student & Course Eligibility

• Student: Should be an Indian resident who has secured admission to a recognised university abroad on his/her own merit. Other factors are also considered, such as the student's academic background, university, courses, and loan type. 

• Age: There is no strict maximum age for students availing loans from the Udaan scheme under PNB education loans. 

• Course and University: PNB education loans are for students securing admission to recognised universities through merit selection. The acceptable courses include degree levels after 10+2 or equivalent. However, students pursuing diploma and certificate courses (excluding pilot training, aeronautical, and shipping) require collateral worth 125% of the loan amount and must fulfil the other conditions. 

Co-applicant & Financial Requirements

• Co-applicant: Parents, grandparents, spouse, and parents-in-law can be the financial co-applicants in an education loan.

• CIBIL Score: While PNB does not explicitly state a rigid CIBIL score, a score above 685 is considered safe for the co-applicant. 

Loan Features

• Loan Margin: A 15% margin is required for loans above ₹4 lakh, whereas no margin applies to loans below this cap.

• Collateral Threshold: PNB offers collateral-free education loans for amounts up to ₹7.5 lakh. Conversely, collateral equivalent to 100% of the loan amount is required for loans above ₹7.5 lakh. 

Check if you qualify for an education loan best suited to your needs through WeMakeScholars for free. 

Apart from PNB Udaan, other PNB education loan schemes offer funding only to support higher studies within India. They all have specific purposes based on institute type, course type, and the requirements of students with limited financial support, etc. The following breaks down each of these schemes:

PNB Saraswati 

PNB Saraswati education loans are for high-scoring students who want to pursue their general higher education in India. Approved courses include UG, PG, PG diplomas, and other regular courses through recognised universities. The PNB Saraswati education loan offers interest rates starting from 8.35% p.a. Its secured loans carry no restriction on the loan amount, and unsecured loans are up to ₹7.5 lakh (covered under the CGFSEL).

PNB Pratibha

PNB Pratibha offers loans to students who secure admission in Indian premier institutes that include business schools, engineering, medical, and other recognised institutes. These include IIM, IIT, ISB, and FMS Delhi, and other institutes listed under the scheme. Their starting interest rate is 7.20% p.a. The loans are offered based on requirement and thus carry no maximum limit, as it is dependent on the student’s repayment capacity. Another benefit is that collateral is not required for premier institutes. 

PNB Kaushal

PNB Kaushal education loans cover skill development courses or vocational training, including technical and non-technical courses. The interest rates start from 9.85% p.a. and 9.35% p.a. for female students, with loan amounts between ₹5,000 and ₹7.5 lakh.

PNB Honhaar

The PNB Honhaar scheme provides education loans for higher studies specifically in Delhi. Degree education, diploma, or other specified skill development courses are among the accepted courses in this scheme. The interest rate starts at 10.35% p.a., with loans up to a maximum of ₹10 lakh.

PM Vidyalaxmi

The PM Vidyalaxmi is a government loan product offering only unsecured education loans to students securing admission in the 1,425 Quality Higher Education Institutions (QHEIs) in India. Along with Indian nationals, NRI (Non-Resident Indians) and OCI (Overseas Citizens of India) students are also eligible for this scheme. The starting interest rate is as low as 7.10% p.a., with no collateral requirement for loans up to ₹7.5 lakh.

PNB PM CARES

PM CARES is a government scheme offered under PNB education loans to provide financial support to children who lost their parents to the COVID pandemic. This scheme applies to children who were below 18 years at the time of their parents' death, and runs until the applicant turns 23 years. The interest rates begin at 8.60% p.a., with loans up to ₹7.5 lakh under the CGFSEL and higher amounts with collateral.

Concessional Education Loans to PWDs

The Concessional Education Loans are offered to Persons with Disabilities (PWDs). They offer loans up to ₹50 lakh for both abroad and domestic higher studies. The interest rate is a fixed 4.00% p.a. 

All PNB education loan interest rates are linked to the Repo Linked Lending Rate (RLLR), PNB’s external benchmark tied to the RBI repo rate. Effective from 8th October 2026, the applicable interest rate on a PNB education loan for abroad studies is 8.35%, which is also the starting rate for secured loans for the top 50 universities. Alternatively, unsecured loans begin at 9.85% p.a.

There are also certain concessions on interest rates. A 0.5% concession applies to female students on the standard rate. Additionally, if you choose to pay interest during your moratorium, a 1% interest concession is granted.

To learn more about the top universities, check out the top 100 universities in the world.

Here are the details of the education loan documents required for education loan in PNB during the application process:

After Sanction: Disbursement and Sending Money Abroad

Loan sanction is the end of the loan application process and is followed by the next, more important step: education loan disbursement. PNB disburses the education loan amount in small tranches. These are instalments that are planned around your university fee schedule for the entire study period. Similarly, living expenses and miscellaneous costs are disbursed promptly based on requirement and occurrence. This helps the borrower, as they are charged interest on the disbursed amount rather than the full sanctioned amount. 

• Tranche Schedule: The schedule for disbursement tranches is planned according to your offer letter and course duration. The initial tranche covers the tuition and other mandatory fees for admission confirmation. The next disbursements are planned around your semester/payment schedule as given by the university. Living expenses are disbursed in these tranches or are paid in smaller monthly installments. The student is asked to provide proof of continuous enrollment, like a marksheet or certificate, to get these disbursements. 

• University Demand Letter: The initial disbursement is given after a fee demand letter and acceptance letter are released by the university. This can also be an invoice to the student or the bank. This letter mentions the exact due amount and payment deadlines. The bank values and adheres to this document rather than releasing funds directly into your account. 

• A2 Form: Banks in India require an A2 form to send money abroad as a foreign remittance to the borrower. This is a regulatory declaration to FEMA (Foreign Exchange Management Act) to comply with RBI’s guidelines. The bank will usually fill this out, but it requires confirmation from the borrower too. 

• Forex and TT Charges: Currency conversion and telegraphic transfer (TT) charges are to be paid towards processing costs the bank has to incur. These charges cover wire transfer and correspondence fees. The charges are deducted directly rather than being added to your loan amount.

• Proof of Payment: After the disbursements are covered, the borrower is required to provide proof of payment documents. This can be a payment receipt, confirmation email, or fee receipt. This allows the bank to maintain verified reports of disbursements and prevent delays in upcoming payments. 

The processing and documentation charges in PNB education loans vary by scheme. 

Studies in India carry no education loan processing fees, while PNB’s Udaan abroad scheme does. PNB also does not charge prepayment charges on any of the schemes. Documentation charges, including legal and valuation costs in case of collateral, may apply. Moreover, no scheme has any prepayment charges. 

Each PNB education loan scheme has set education loan margins; for example, the PNB Udaan loan has a 15% margin on loans above ₹4 lakh. The domestic schemes charge a 5% margin on loans above ₹4 lakh. The PNB Honhaar scheme is exempt from this and has no loan margin. 

Take a look at the table to get a better idea:

Arranging for additional loan expenses can sometimes be difficult. However, financial officers at WeMakeScholars guide you towards finding education loans with lower charges to ensure your expenses are covered smoothly. 

You can complete your PNB education loan online apply process through PNB's loan application portal or through the WeMakeScholars portal.

Follow these steps to complete your loan application at PNB:

Step 1: Complete the registration and provide your application details on the portal

Step 2: Visit the nearest branch to verify and confirm your eligibility with the bank 

Step 3: Carry attested identity, financial, collateral, and other required documents for verification

Step 4: Ensure legal and valuation are complete in case of secured loans, and credit and other financial checks for unsecured loans

Step 5: Receive your loan sanction

Step 6: Finish the loan creation process by signing the loan agreement, including any documentation process before the disbursement

Step 7: After submitting all documents required for education loan in PNB for disbursing the amount, the bank approves disbursement of the loan amount according to your university’s schedule

Why Shouldn't You Go Directly Through Banks?

While PNB can offer loan amounts without a strict limit and competitive interest rates, its collateral conditions can limit your potential to get better deals. Moreover, you can also face the following administrative issues while going directly through banks:

• Complicated education loan process

• Longer processing time

• Won’t provide the complete list of required documents

• Several types of charges can be hidden from you 

• You will have lower chances of a loan sanction

An expert in education loans at WeMakeScholars saves you time by giving you one form to fill out and direct information regarding every loan question. They also connect you with partnered banks and get you negotiated interest rates based on your profile.

To calculate your EMI, let’s take the following example and run it through the PNB education loan EMI calculator: You secure a ₹30 lakh education loan for a 2-year course, with an interest rate of 8.35%, and pay full simple interest during the moratorium. Your payment differs by the tenures given below:

However, your monthly payable EMIs and interest depend on more factors specific to your profile that the PNB education loan EMI calculator could miss. Check out our education loan EMI calculator to get estimated figures. 

Repayment, Moratorium, and Prepayment

PNB offers a maximum repayment tenure of up to 15 years, with a moratorium period/repayment holiday of the entire course duration plus a 1-year grace period. 

During the moratorium period in an education loan, the interest payment for a PNB education loan is not mandatory, and thus, you can opt out of it. If you decide to opt out of interest payment during the moratorium, it will be added to the EMIs that follow. 

The bank also gives you the choice of closing off the loan early in the following ways:

• Opting for a shorter duration of repayment 

• Making a prepayment

• Balance transfer to another bank

There are also no prepayment penalties for any of the schemes, meaning you can close your loan early.

Insure yourself against education loan repayment issues by choosing WeMakeScholars. Request a callback today!

WeMakeScholars is an organisation that aims to help students compare and apply for study loans who wish to pursue higher education abroad. We are partnered with 20+ banks, including NBFCs, and hence provide faster loan sanctions. You receive the following benefits if you take an education loan through WeMakeScholars:

• Better Interest Rates: We are partnered with 20+ banks and hence have an interest rate that is up to 2% lower than when you go directly through banks.

• Faster Loan Process: PNB education loan processing time can be reduced by up to 50% when you process it through us.

• Tax Benefits: We ensure that you take advantage of all the education loan tax benefits under section 80E.

• End-To-End Support: Students come to us to get a loan sanctioned, and we in turn provide them with assistance throughout their loan period until the repayment of the full loan.

• Cashback: Students going through us earn cashback of up to ₹3,000 in their first disbursement.

Here is an overview comparing PNB’s education loan interest rates, loan amounts, and processing fees with other public banks:

*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. 

For your funding journey to study abroad and in India, PNB offers several education loan schemes tailored to specific student profiles. It does not have a strict loan cap and also offers collateral-free options up to ₹7.5 lakh in loan amount. Strong student profiles or admission to a top-50 university can bring interest rates as low as 8.35% p.a. 

Check your eligibility through WeMakeScholars and request a callback to get started with your PNB education loan process.