Are you planning to pursue higher studies and running short of funds to support your education and planning to take a loan? Well, worry not in that case because banks in India have designed various schemes to benefit students who wish to pursue higher studies in India as well as abroad. In this blog, you shall get to know about the Indian Overseas Bank (IOB) Education Loan and we hope it will help you. Indian Overseas Bank offers Vidya Jyoti Education Loan Scheme to applicants who wish to pursue undergrad, postgrad, or diploma courses in India or abroad from any recognized university.
This Blog Includes:
- What is an Education Loan?
- What is IOB Education Loan
- Determinants of Eligibility for IOB Education Loan
- Compare Your Bank for Education Loan
- Expenses covered under Indian Overseas Bank Student Loan Scheme
- Which courses and universities are eligible for the IOB Education Loan?
- Loan Amount and Margin Money Possible Under IOB Education Loan to Study Abroad
- Documents Required for IOB Education Loan
- Loan Schemes of IOB
- IOB Education Loan Interest Rate
- Indian Overseas Bank Education Loan Calculator
- Advantages of Indian Overseas Bank (IOB) Education Loan
- EMI Payment Methods
- How to Avail the IOB Education Loan ?
What is an Education Loan?
An education loan is a loan or a sum of money obtained by a person to pursue higher education in India or abroad. After the student completes their study, the loan payback begins, and students are allowed a grace period of six months to find or join a job.
Your choice of interest will impact the payback amount; you must pick how you wish to repay the loan. That is, if you wish to begin playing during the moratorium period or after the moratorium period has ended. The Moratorium term is equal to the length of your schooling plus six months or a year to find work. You are only required to repay the loan when this period has passed. The loan interest begins to accrue at the time of disbursement of money, so by the time you graduate, you will owe a large sum. The other option is for your parents or guardians to begin paying the debt while it is still in the moratorium period.
What is IOB Education Loan
Everyone is eager to spend a lot of money on education in order to live a rich life in the future. Indian Overseas Bank (IOB), being one of the largest education loan providers, understands the needs of students and provides highly competitive education loans with lower interest rates. Every year, Indian Overseas Bank (IOB) education loans help a huge number of students get admission to renowned institutions and colleges in India and abroad.
Individuals who want to pursue a Diploma, Graduation, or Post-Graduation program at a recognized university can apply for an Indian Overseas Bank Vidya Jyoti education loan. The loan is also available to people who want to do technical or professional courses in another country. Indian Overseas Bank offers education loans at affordable interest rates.
Determinants of Eligibility for IOB Education Loan
Students who wish to apply for IOB Education Loan must be aware of the eligibility criteria notified by the bank. Let’s have a look at the eligibility criteria given by the bank –
- Applicants must be Indian citizens.
- Applicants must have secured at least 60% in the last appeared exam for, XIIth or graduation.
- Applicants must have secured admission in India or Abroad through a proper entrance test . Or the selection should have been merit based selection.
- Applicants must not be employed.
- Reputation of the college/university is often considered while providing loan, in cases where admission is not through entrance.
Compare Your Bank for Education Loan
|Bank / Financer||IOB||SBI||PNB||AXIS|
|Applicable Rate of Interest||Up to INR 7.5 Lacs: 10.70%Above INR 7.5 Lacs: 11.70%For vocational course: 11.70%For the wards of staff members: 10.40%||Up to INR 7.50 Lacs: 10.55%Above INR 7.50 Lacs: 10.80%||up to INR 7.5 Lacs: MCLR + 2.00%above INR 7.5 Lacs: 2.60%||Upto 4 Lacs- 16.50%Upto 7.5 Lacs- 17.50%Above 7.5 Lacs- 15.50%|
|Max Loan with Collateral||For India: INR 30 LacsFor Abroad: INR 40 Lacs||For India: 10 LacsFor Abroad: 20 Lacs||For India: 10 LacsFor Abroad: 20 Lacs||For India: 10 LacsFor Abroad: 20 Lacs and beyond based requirement|
|Max loan without collateral||For India: INR 30 LacsFor Abroad: INR 40 Lacs||For India: 10 LacsFor Abroad: 20 Lacs||For India: 10 LacsFor Abroad: 20 Lacs||For India: 10 LacsFor Abroad: 20 Lacs and beyond based requirement|
|Processing Fee||Nil||Up to INR 4 Lacs: NilAbove INR 4 Lacs: INR 5000||Nil||Nil|
Expenses covered under Indian Overseas Bank Student Loan Scheme
The expenditures covered by the Indian Overseas Bank Student Loan Scheme are listed below.
- Tuition/ college/ hostel fee
- Examination/ lab/ library fee
- Books/ uniform/ instruments
- Caution deposit
- Passage money for studies abroad, etc
Which courses and universities are eligible for the IOB Education Loan?
The Vidya Jyothi Educational program is open to colleges that have been recognized by Indian statutory agencies such as the UGC/GOVT/AICTE/AIBMS/ICMR. However, the system excludes vocational/skill development courses, PG diplomas, and courses taken at an online university.
Loan Amount and Margin Money Possible Under IOB Education Loan to Study Abroad
Students can borrow up to INR 30 lakhs from the bank under this plan to fund their studies in India. The cost of studying overseas is INR 40 lakhs. The minimal amount a student can borrow in both circumstances is more than INR 7.5 lakhs. For studies in India, a student can borrow a maximum of INR 50 lakhs, while for studies overseas, a student can apply for a loan of up to INR 60 lakhs.
- The PNB Education Loan Program
- SBI Education Loan
- Syndicate Bank Education Loan
- Vijaya Bank Education Loan
- ICICI Education Loan
Documents Required for IOB Education Loan
Applicants must have a list of documents while applying for education loan. We have listed the necessary documents below :
- Loan application form of the bank to be filled
- Two passport size photos
- Proof of age
- Offer Letter from the University
- GMAT/IELTS/TOEFL/GRE results
- Proof of residence
- Marksheet of the last exam appeared for
- Co borrower’s statement of assets and liabilities
- Scholarship letter, if present
- Documents supporting the financial status
- Collateral documents
- Entrance exam results
Also Read: Education Loan without Collateral
Loan Schemes of IOB
IOB does not provide multiple loan schemes for education. The most popular one has been mentioned below:
|Loan Scheme||Loan Amount||Interest Charges|
|Vidya Jyoti||For courses in India – Maximum Loan up to INR 30 lacs
For courses abroad: Maximum Loan Upto INR 4O Lacs
Up to ₹ 10,00,000 for studies at IITs, IIM’s, and ISB’s.
- IDBI Education Loan
- Bank of Baroda Education Loan
- Allahabad Bank Education Loan
- Canara Bank Education Loan
- HDFC Education Loan
IOB Education Loan Interest Rate
The bank’s interest rate is RLLR + Spread (Repo Connected Lending Rate + Spread), which means it is linked to the RBI’s repo rate. The RLLR (w.e.f. 1.07.2020) is 6.85 percent, with a spread of 3.20 percent, resulting in a 10.05 percent effective rate of interest. Women candidates are eligible for a 0.50 percent discount.
Indian Overseas Bank Education Loan Calculator
To figure out how much you’ll have to pay each month, utilize the Indian Overseas Bank Loan EMI calculator. The calculator is simple to use, and the results are displayed immediately. Basic information such as the processing fee, interest rate, loan amount, and tenure must be entered to compute the EMI.
Advantages of Indian Overseas Bank (IOB) Education Loan
Some of the benefits of applying for an educational loan with Indian Overseas Bank are listed below (IOB).
- Low interest rate
- No hidden costs and administrative charges
- Less paperwork
- No processing fees
- No security required for up to 4 Lakhs
- 0.50% concession for girl students
Now applicants might also want to know the repayment terms provided by IOB. Mentioned below is the Repayment Frequency of IOB Education Loan:
- IOB provides quarterly or monthly rests for loan repayment.
- Repayment period starts 1 year after the completion of the course or six months after getting a job, whichever happens before.
- After disbursement of the first installment of the loan, the interest re‐payment starts.
- Education Loan for MBA
- Best Education Loan in India
- Education Loan = Buying a Stake in an Individual
EMI Payment Methods
Education loans from the Indian Overseas Bank (IOB) can be repaid in three ways.
- Standing Instruction (SI): If you already have an account with Indian Overseas Bank (IOB), Standing Instruction is the ideal way to pay back your debt. At the conclusion of each monthly cycle, your EMI payment will be automatically deducted from the Indian Overseas Bank (IOB) account you designate.
- Electronic Clearing Service (ECS). If you have a non-Indian Overseas Bank (IOB) account and would want your EMIs to be deducted automatically at the end of the monthly cycle, you can use the
- Post-Dated Cheques (PDCs): Post-dated EMI checks from a non-Indian Overseas Bank (IOB) account can be sent to your local Indian Overseas Bank (IOB) Loan Centre. A new set of PDCs will need to be submitted as soon as possible. Please note that only non-ECS locations will be accepted for Post Dated Cheques.
- It is advised that you utilise either the SI or ECS form of payment rather than PDCs since they are speedier and less prone to mistake.
How to Avail the IOB Education Loan ?
IOB Education Loan can be applied for, both in the offline and online mode.
For those who wish to avail of the loan through offline mode, they must follow the given steps.
- For availing the IOB Education Loan, applicants must make sure they know all the requisites beforehand.
- They can go to their nearest bank branches and collect the application form.
- The complete application form must be submitted along with all the documents asked for.
- Applicants must patiently wait for the verification process.
Applicants who wish to apply online should follow the steps given below –
- Applicants must log on to the official website of Indian Overseas Bank.
- After logging in applicants must click on ‘Educational Loan – Vidyajyoti’, under the ‘Retail’ section.
- After which they are requested to click on www.vidyalakshmi.com.
- Applicants must enter the relevant details that are asked for then.
- After completing the above mentioned steps, an Indian Overseas Bank executive will get in touch to process the request.
The minimum loan amount is Rs.7.50 lakh.
The margin of the loan for studies abroad is 15% and studies in India is 5%.
Yes, an extension period of up to 2 years is provided in such a case.
The RLLR affects the interest rate on student loans.
A loan of Rs.7.50 lakh is the least amount that may be obtained.
So, this was all about the IOB Education Loan. We hope you found this blog useful and it answered all your questions. For more such content stay connected with Leverage Edu!