How to Apply for an Education Loans!

A portal has been developed for students to help them meet their education finances. The Department of Financial Service (Ministry of Finance) Department of Higher Education, Ministry of Human Resource Development and Indian Banks Association, have all come together to solve the financial problem faced by students and their parents in pursuing their aim of higher studies. This scheme is called ‘Vidya Lakshmi’ and it is a portal which is being developed and maintained by NSDL e-Governance Infrastructure Ltd. With the help of this portal student can view and track and even apply for loans to banks any time Students can view, apply for the education loan to banks anytime and can also track the development. The portal also provides linkages to National Scholarship Portal.

The Special features of the scheme are as under:

• The scheme provides for loan up to 7.5 lakhs for studies in India and upto 15 lakhs for studying abroad.
• No collateral or margin is required for loans up to Rs 4 lakh and it also says that the interest rate should not exceed the Prime Lending Rate (PLR).  For loans above Rs. 4 lakh the interest rate will not be more than PLR plus 1 percent.
• Repayment of loans is spread over 5 to 7 years with a provision of a grace period of one year after completion of studies.
• Only loans taken for higher education - full time studies in any graduate or post-graduate, professional, and pure and applied science courses - may claim Tax deduction. The deduction will be available for a maximum of eight years starting from the day you start repaying.
• To make education available to all students the University grants commission has apart from making universities provide liberal financial support to deserving students in addition it has also asked banks to arrange loans for students desirous of fulfilling their ambition as they should not suffer.
• A notice consisting of guidelines for this purpose has been issued by the Reserve Bank Of India to all commercialised banks in this regards.

To apply online, the documents needed are:

• Attested copies of documents for proof of date of birth and residential address
• Passport size photos of the applicant, co-applicant and guarantors
• Copies of previous exams mark sheets/ degree certificate.
• Income proof, latest income tax returns of parents, co-obligant, guarantors (if any).
• Details of collateral securities and also valuation certificates of Government approved valuer (if any)
• Details/statements of Bank accounts held by the student applicant/co-obligant(s) /guarantors (if any) for the last six months
• Copy of Passport/Visa, cost of air fare (documentary detail) in case of studies abroad

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