1. Objective:
The Education Loan Scheme aims at providing financial support to students for pursuing higher education in India. The main emphasis is that a meritorious student, though poor, is provided with an opportunity to pursue education with the financial support from the banking system with affordable terms and conditions.
2. Eligibility Criteria:
2 (i) Student eligibility:
a) Should be an Indian National.
b) Should have secured admission to a higher education course in recognized institutions in India through Entrance Test / Merit Based Selection process after completion of HSC (10 plus 2 or equivalent ).
2.(ii)Courses Eligible:
i) Approved courses leading to Graduate / Post Graduate degree and PG Diplomas conducted by recognized colleges / universities recognized by UGC / Govt. / AICTE / AIBMS / ICMR etc.
ii) Courses like ICWA, CA, CFA etc.
iii) Courses conducted by IIMs, IITs, IISc, XLRI. NIFT, NID etc.
iv) Regular Degree / Diploma courses like Aeronautical, pilot training, shipping, Nursing or any other discipline approved by Director General of Civil Aviation / Shipping / Indian Nursing Council or any other regulatory body as the case may be, if the course is pursued in India.
v) Approved courses offered in India by reputed foreign universities.
vi) CEO/General Manager may consider financing following courses where placement record gives confidence about employability:
a) For studying part-time job oriented courses (evening classes or otherwise ), which are approved / recognized by the regulatory body / authority.
2.(iii) Expenses considered for loan:
i) Fee payable to college / school / hostel.*
ii) Examination / Library / Laboratory fee.
iii) Insurance premium for student borrower, if applicable.
iv) Caution deposit, Building fund / refundable deposit supported by Institution bills / receipts. **
v) Purchase of books / equipment’s / instruments / uniforms.***
vi) Purchase of computer at reasonable cost, if required for completion of the course.***
vii) Any other expense required to complete the course – like study tours, project work, thesis, etc.***
*Lodging and boarding charges be considered in case the student chooses / is required to opt for outside accommodation. However, these charges should not exceed the charges stipulated by the respective college / University for the accommodation / hostel facilities provided by them. In case, no such facility is provided by the college / educational institute, the charges being levied by other colleges / educational institutes in the area shall be applicable. However, in cases where these facilities are not being provided by any educational institutes in the area where the respective institute is situated, sanctioning authority to take a decision in the matter after taking a realistic view regarding expenses on boarding / lodging based on local enquiries / market reports etc., which shall also form a part of appraisal note.
Reimbursement of expenses incurred by student borrower towards lodging and boarding charges, in case they opt for outside accommodation other than that provided by College / University, be allowed on the basis of self declaration of the students borrower in having incurred these expenses to the extent the amount was taken into consideration at the time of sanction of loan.
** These expenses could be considered subject to the condition that the amount does not exceed 20% of the total tuition fees for the entire course.
*** It is likely that expenditure under Item Nos. vi & vii above may not be available in the schedule of fees and charges prescribed by the college authorities. Therefore, a realistic assessment may be made of the requirement under these heads. However, the maximum expenses included under vi & vii may be capped at 20% of the total tuition fees payable for completion of the course.
3. Quantum of Finance – Maximum Rs.15 lakhs
Need Based Finance to meet the expenses as per Para-2(iii) above be considered (taking into account the prescribed Margin ).
4. Re – imbursement of fees:
Reimbursement of tuition fee paid before release of advance Branch Manager is permitted to reimburse the fees paid by the student / guardian at the time of admission or subsequent stages within six months from the date of payment of fees on individual merits of the case. The reimbursement will, however, be within the sanctioned limit and subject to production of proper receipt / documentary evidence or proof of payment to the satisfaction of the bank.
5. Margin:
Up to Rs. 5 lakhs – 10%
Above Rs. 5 lakhs – 20%
– Margin may be brought -in on year-to-year basis as and when disbursements are made on a pro-rata basis.
6. Security:
i) Upto Rs. 5 lakhs:
Parent(s) / guardian be made joint borrower(s). Obtain one 3rd party guarantee. No tangible security.
ii) Above Rs.5 lakhs:
Parent(s) / guardian be made joint borrower(s) and obtain Tangible collateral security of suitable value i.e. minimum 1 ½ times of loan amount.