SBI Education Loan In India – SBI Student Loan Scheme

The former president of India Dr. APJ Abdul Kalam, an educationist himself says “To succeed in your mission, you must have single-minded devotion to your goal”. To reach your career goal, you must set an educational goal for yourself. As you know, to meet your educational goal, you need funds. But, if you cannot spend huge on higher education, it is not that you cannot reach your goal. Thanks to the educational loan offered by State Bank of India, which is one of the most popular public sector banks in India.

SBI Education Loan

Educational Loan Records

Every year, the number of Educational Loans obtained by students is increasing. Here is a table to show the same in different banks including SBI:

Educational Loans in India (in Crores) in different banks
LenderFinancial Year Ending 2015Financial Year Ending 2016Financial Year Ending 2017
Indian Bank250528671
UCO Bank101298347

So, the educational loans obtained in all banks have increased in 2017 as compared to the previous year except in IOB.

A Small Intro For SBI

State Bank of India, popularly known as SBI is actively involved in a non-profit activity known as Community Services Banking right from the year 1973. The good thing about this public sector bank in India is that all branches of the bank have branches and administrative offices all through the country take part in a number of social causes and welfare activities. Their area of business is more than banking as they touch the lives of people anywhere in a number of ways. The commitment of this bank to nation-building is comprehensive and also complete.

What Are The Types Of Educational Loans Offered by SBI?

Thanks to SBI to make an excellent initiative to help for the higher education of Indian students not just within the country, but also abroad. To ensure the same, they offer different kinds of educational loans like:

  • Scholar loan
  • Global Ed-Vantage
  • Student Loan
  • Skill Loan
  • Take-over of Education loans

Scholar Loan

If you intend to do your higher education in one of the premier institutions in India like AIIMS, NITs, IIMs, IITs and also other top-class institutions, you can go for this loan. When you go for this loan, you can get up to Rs.30 lacs to support your education.

Global Ed-Vantage

It is an educational loan for you if you intend to do your full-time regular course at any of the foreign university or institution. The loan amount you can get is least Rs.20 lacs to a maximum of Rs.1.5 Crores.

Student Loan

It is for doing your higher education in India or abroad. You can get a loan amount of Rs.10 Lacs for higher studies in India. Even, you can get a loan amount of up to Rs.20 Lacs for higher studies abroad.

Skill Loan

If you have secured an admission to one of the vocational education and training institutions in India, you can manage your course fee with this loan offered by SBI.

Take-over of Education Loan

If you are already paying high EMIs for loans that you have obtained from other banks, you can switch those loans to SBI under this scheme. The benefit here is that switching to SBI will help with bringing down the rate of interest.

What Should You Know About The Student Loan Scheme?

From the above-mentioned types, let us gather some details about the student loan scheme offered by SBI. The reason is that this loan will help you regardless of whether you plan to do your higher education in India or abroad.

What is it?

The SBI Student Loan Scheme is a term loan that is granted to Indian nationals. The repayment period for this loan is up to 15 years. The good thing here is that you can repay this loan after completing your course and even after 12 months of your repayment holiday. One more positive thing about this loan is that you will not be charged any processing fee or upfront charges when you opt-in.

Courses To Which You Can Get This Loan

Indian Education

If you are planning to do your higher education in India, the courses covered include:

  • Graduation and post-graduation courses including professional degree or diploma and regular technical course conducted by colleges and universities that are approved by the University Grants Commission/All India Council for Technical Education or Government.
  • Regular diploma or degree courses offered by autonomous institutes like IIT and IIM.
  • Teacher training courses that are recognized by the State or Central Government.
  • Regular diploma or degree courses like shipping, pilot training, aeronautical that is approved by the Director General of Civil Aviation/Shipping or appropriate regulatory authority.

Education Abroad

If you plan to do your higher education abroad, you can apply for the loan for the following courses:

  • Courses offered by the Chartered Institute of Management Accountants, London and CPA course in the USA.
  • Professional/technical job-oriented or graduation degree courses or PG courses like MS, MBA, and MCA offered by reputed institutions.

So, you can apply under the SBI student loan scheme for the courses mentioned above.

What Expenses Are Covered?

You can use the loan amount for the following expenses:

  • The fee that you should pay for the college or school or hostel.
  • You can use the money for payment of lab/library or examination fee.
  • For purchase of uniforms/instruments/equipment and books.
  • Also, you can use the money for the purchase of computers essential for the course completion for up to 20% of the total tuition fee payable for course completion.
  • For refundable/building fund or for caution deposit up to 10% of tuition fee for the entire course fee.
  • Passage money or travel expenses if you plan to study abroad.
  • Cost of shopping for a two-wheeler of up to Rs.50,000.

You can spend the money for any other expenses important for the course completion like project work, study tours, etc.

How Much Can You Get As A loan?

Under this scheme, if you are planning to study in India, you can get a maximum of Rs.10 lacs as the loan amount. If you plan to study abroad the maximum possible amount is Rs. 20 Lacs.

If you look for higher loan limit, the bank might consider based on your case. If you look for a higher loan limit for higher education abroad, you can opt for SBI Global Ed-Vantage Scheme.

Will SBI Ask For Any Security For Allocating The Loan?

  • If your loan amount Rs.7.5 lacs or lesser, you need not have to give any third party guarantee or collateral security. But, you should have your parent or guardian as Co-borrower.
  • If the loan amount is more than Rs.7.5 lacs, apart from adding your parent or guardian as co-borrower, SBI will ask for a tangible collateral security.

If you are married, it is not that your parent or guardian should be co-borrower. It can be your spouse or a parent-in-law as well.

What Should You Know About Margin?

Margin is nothing, but the amount you need to pay from your own funds. The bank will pay the rest. For instance, if you are planning to apply for a loan for Rs.50000 and the bank accepts to pay 80%, you will have to bear the remaining 20% on your own.

For this educational loan from SBI, there is no margin for up to Rs.4 Lacs. But, if you borrow above this money, the margin is 5% for higher studies in India and 15% for courses abroad.

What Are The Repayment Conditions?

As mentioned earlier, you will have to start repaying the loan one year after you complete the course. But, you will have to repay it completely within 15 years from commencing repayment. If you get a second loan for higher studies some years after your first loan, you can repay the combined loan within 15 years after you complete the second course.

What To Know About EMI?

You might be aware that EMI stands for Equated Monthly Installments. It is an amount or percentage of your loan money that you agree to pay as monthly repayments of the education loan. You will have to pay this money to the SBI to pay out the money borrowed.

Moratorium period

Generally, banks and other lenders refer to the time during the loan term when you are not required to repay the loan as moratorium period. In other words, it is the waiting period before which repayment via EMIs starts. EMI repayments generally begin after the loan money is disbursed to the borrower and the payment will have to be done each month.

When Does EMI Generation Begin With SBI Educational Loan?

During the course period and also during the moratorium period, the added interest is combined along with the principle and the bank will fix the repayment to be made in EMIs. In case, the full interest is serviced before you commence the repayment, the EMI will be fixed based only on the principal amount.

How About The Rate Of Interest?

Before you know the rate of interest charged by SBI for the student loan scheme, you should be aware of certain terms:


It stands for Marginal Cost of Funds based Lending Rate. It is nothing, but the minimum rate of interest below which any banks cannot lend. They should follow this rule in all cases, except in some cases with the permission of RBI. The MCLR for SBI is 8.15%. It means that SBI cannot lend an educational loan below this rate of interest.


Banks generally give loans from the deposits they get from their customers. When they get a percentage of interest from borrowers, they pay a certain percentage of interest for the depositors. The difference between the interest charged by the bank and the interest the bank pays on deposits is called as a spread. In general, banks charge interest on loans on the percentage that comes as the addition to the MCLR and spread.

Reset Period:

It is period upon which the MCLR is reset. In the case of SBI, the reset period is one year, which means that the MCLR rate will differ once in every year, if it reduces, you will have to pay a lesser rate of interest, but if this rate increases, you will have to pay a higher rate of interest.

The reset period differs from one bank to another. In the case of SBI, it is beneficial with one year, but in other banks like AXIS bank, the reset period is six months.

Actual Rate Of Interest

The rate of interest differs based on the amount you borrow and here is a table to show the same:

SBI Student Loan Scheme Interest Rates
Loan Amount1 Year MCLRSpreadEffective Interest RateReset Period
For up to Rs.7.5 Lacs8.15%2.00%10.15%1 year
More than Rs.7.5 Lacs8.15%2.75%10.90%1 year
ConcessionA concession of 0.50% on the interest rate is applicable for girl students
Further ConcessionsCandidates will get 1% Concession on the full tenure if they get their interest serviced promptly as and when applied not just during the course period, but also during the moratorium period.

SBI Student Loan Scheme 2018 Apply Online

What Are The Documents To Be Submitted?

You will get the educational loan sanctioned, only when you submit the following documents along with your completely filled loan application form with the SBI:

  • Admission letter from your institution
  • A couple of passport size photos
  • Statement showing the education expenses
  • PAN card (yours and your parent/guardian’s Card)
  • AADHAR Card (yours and your parent/guardian’s Card)
  • Identity Proof (AADHAR/Passport/Driving License or other photo identity)
  • Residence Proof (Telephone bill/electricity bill/passport/driving license)
  • Bank account statement for the past six months (yours or your parent/guardian’s statement)
  • Income Tax Return/Assessment Order of the previous two years (parent/guardian/other co-borrower)
  • A brief statement that shows the assets/liabilities or co-borrower, parent or guardian)
  • Income Proof like salary slip or Form 16 of co-borrower/parent/guardian.

Now you know about the SBI Student Loan Scheme. But, if you are looking for more funds to study abroad, you can go for the SBI Global Ed-Vantage Scheme as mentioned earlier. Here are some details about this loan:

What Are The Key Features Of SBI Global Ed-Vantage Scheme?

If you are planning to do a full-time regular course at a foreign university, it is the loan for you. Of course, the SBI Student Scheme also offers funds to study abroad. But, you cannot get more money from that scheme. But, this scheme will help you with more funds as loans. The key features of this scheme include:

  • Tax Benefit under section 80 (E) of Income Tax Act
  • Early approval of loan application and you can get the loan sanction before the i20/Visa
  • Easier repayment through EMI that is spread over 15 years.
  • Higher loan amount is possible to obtain. Yes, you can get minimum 20 Lakhs to maximum 1.5 Crores.
  • Attractive rate of interest
  • Quicker online application process.

Countries For Higher Education

With this loan offered by SBI, you can take up regular UG, PG or Doctorate courses in any discipline offered in New Zealand, Hong Kong, Japan, Singapore, Europe, Australia, Canada, UK, and USA.

How about the Margin?

In the margin, the assistantship/scholarship you get from other sources should be included. Margin to be brought on a year-on-year basis as and when the distribution of funds is made on a pro-rata basis. The processing fee for this loan is Rs.10000 per application.

Interest Rate

SBI Global Ed-Vantage Scheme Interest Rates
Loan Limit1 Year MCLRSpreadEffective Interest RateReset Period
Above Rs. 20 Lacs and maximum Rs. 1.5 Crores.8.15%2.50%10.65%1 year
ConcessionA concession of 0.50% on the interest rate is applicable for SBI Rinn Raksha or any other life insurance coverage assigned in favor of SBI.
Further Concessions0.5% concession for girl students.


You will have to offer tangible collateral security to get this loan. It should be offered by a third party other than your parents.


Maximum15 years is allowed by NeoDocto for Repayment. You should start repaying 6 months after course completion.

Take Away

  1. From the information above, you should know that SBI offers different types of loans to Indian students. The bank offers loans that will help students to continue their higher education both in India and abroad.
  2. When some types offer this facility, there are types like Ed-Vantage that are specifically designed for helping Indian students to pursue their dream higher education course abroad.
  3. Further, the bank also offers a type, where students can shift from the loans with a high interest they have taken from other banks to SBI. In turn, they will get a lower rate of interest and also attractive repayment terms.

SBI, being one of the prominent banks in India contributes a great towards the educational development of Indian students to reach new heights in their life by getting the best quality education even from a prominent type of institutes like IITs and NITs through the Scholar Loan Scheme. So, apply for the right loan and you can reap the benefits for sure.


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