When it comes to all the building blocks that form a complete and successful life, nothing is as important as quality education. However, education in India, at least the commonly perceived ‘quality education’ as imparted by acclaimed and influential educational institutions, is decidedly costly and not easily available to everyone- especially those who deserve it based on merit alone. Thus, education loans are vitally important. A barebones explanation for an education loan is thus, ‘funds offered by financial institutions to meritorious and/or deserving students so that the latter can pursue their basic/higher education, in India or abroad’. Almost all banks in India offer education loans, and the demand for it has remained stable with the Indian student community. Canara Bank also provides financial assistance to well deserving students at liberal terms and conditions and low-interest rates.
Bachelors (Graduation) and Masters (Post-graduation) that include professional as well as technical courses with work potential conducted by colleges or universities validated by UGC, Government, Department of Electronics, AICTE, IMC, and autonomous institutes like IIT, IIM, Madras Christian College etc.
Any Bachelor’s or Master’s Degree that is employment-oriented from an approved institute.
- Mark sheet of the most recent qualifying public exam for school or college in India.
- Proof of admission to the course (Fee receipts, Transfer Certificate, etc.).
- Schedule of expenses for the course (Fee receipts obtained from the institute).
- Two recent passport size photos of the borrower, co-obliged and guarantor.
- A duplicate copy of any national ID card like passport, Voter’s ID, Driving License etc.
- Recent salary slips if you are a salaried person and income proofs like the reference from clients, IT papers etc. if you are self-employed, freelancers, professionals, entrepreneurs or agriculturist.
Student Eligibility Criteria
- The student must be an Indian National & must have passed the required course with essential grades.
- The applicant must have received admission in a course in any recognized institute, approved by the State or Central Government.
Maximum Loan Amount
- Typically up to Rs. 1,000,000 for studies in India; with minimum margin money (own contribution by student/ family) of 5% of total cost for loan above 4 Lakh. No Margin for loan less than 4 Lakh
- Typically up to Rs. 2,000,000 for studies abroad with minimum margin money (own contribution by student/ family) of 15% of total cost for loan above 4 Lakh. No Margin for loan less than 4 Lakh
- Up to Rs. 2,000,000 for studies at IIT’s, IIM’s and ISB’s with minimum margin money (own contribution by student/ family) of 5% of total cost
Expenses covered under the education loan
- Admission fees including monthly fees and examination fees
- Books, stationery, and equipment
- Travel expenses/ passage money for studies abroad
- Boarding and lodging expenses of authorized hostel or boarding house
- Expenses required completing the courses like those on study tours, project work and thesis etc
- Insurance cover for the student
- If the loan you have taken is less than INR 4 lakhs, no interest will be levied.
- For loan sum more than that, 5 percent interest will be levied if you are studying in India and 15 percent if you are going abroad.
- The loan is provided conjointly to the applicant and his/ her guardian.
- There is an agreement that future earnings of the student will contribute to loan repayment.
- No collateral is required if the loan amount is less than INR. 4 lakh.
- For loan sum between INR. 4 lakh and INR 7.5 lakh, guarantee from a bank-approved third party may be required. To avoid this, the borrower can offer the security of palpable assets (covering the loan amount) in its stead.
- If the loan amount is more than INR. 7.5 lakh, the security worth the same is required as collateral.
Canara Bank Education Loan – Things to check
- You have a valid offer letter from a recognized educational institution.
- You meet the eligibility criteria of the bank that you are applying to.
- You have not defaulted on loans or credit card dues in the past and have not delayed payments. If you have, these will reflect in your CIBIL report, hurt your CIBIL score and may result in rejection of your education loan application. Estimate your CIBIL score for free by using CIBIL score estimate calculator
- Your CIBIL report does not erroneously show defaults or delayed payments. This can be due to the inadvertent error in data shared by banks with CIBIL.
- You have made own arrangement for margin money and for expenses that are not covered by banks under education loan.