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SBI Takeover of Education Loan Scheme: A Game-Changer for Students

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sbi takeover of education loan scheme

One of India’s biggest public sector banks, the State Bank of India (SBI), recently made news when it took control of the Education Loan Scheme. This action has important consequences for students looking for financial aid or education loans to pursue higher education. In this blog post, we’ll examine the effects of SBI’s acquisition and talk about how they might change the playing field for students all over the nation. The Education Loan Scheme being taken over by SBI is a positive development for students hoping to pursue higher education. Read this blog to know all about SBI takeover of education loan scheme!

ParticularsDetails
Processing FeesNil
Repayment Period Up to 15 years 
Loan AmountINR 10 Lakh to INR 1.5 Crores
Interest Rates 9.55% p.a. 
Top Up FacilityAvailable
Collateral SecurityRequired (MInimum 100% of the amount of the proposed loan amount)

Salient Features of SBI Takeover of Education Loan Scheme

However, the SBI, one of India’s biggest public sector banks, does provide a number of education loan programmes for higher education to help students pay for their studies. The following are some of the common characteristics of SBI’s education loan programmes:

  • Loan Coverage: Undergraduate, graduate, and professional courses are typically all covered by SBI education loans, both in India and abroad.
  • Loan Amount: Depending on the institution and the course, SBI may offer a different loan amount. In general, the loan can be used to pay for tuition, exam fees, library fees, lab fees, and other associated costs.
  • SBI offers a variety of flexible repayment plans for student loans. Up to 15 years can pass before the loan is repaid, giving borrowers time to do so.
  • Collateral Requirements: SBI may require collateral as security depending on the loan amount. Collateral may not be required for loans under a certain amount, but for loans over that amount, real collateral or third-party guarantees may be required.
  • SBI provides education loans at competitive interest rates. Interest rates can change depending on the loan amount, loan term, and provided collateral, among other things.
  • SBI education loans typically have a moratorium period during which the borrower is exempt from repayment obligations. The moratorium period typically lasts until the course is finished along with an additional six to twelve months.
  • Subsidy and Concessions: For qualified students, the SBI and the Indian government may offer a variety of subsidies and concessions on education loans, including lowered interest rates and longer repayment terms for economically disadvantaged groups.

Also Check Out: SBI Scholar Loan

Eligibility Criteria

The following are the requirements for applying for the SBI takeover of the Education Loan Programme:

Citizenship

The candidate must be an Indian national.

Age

The applicant’s age should typically fall within the range that the bank has established. Students between the ages of 16 and 35 are typically eligible for student loans. However, there might be some exceptions for particular loan programmes.

Entry into Approved Institutions

The applicant must have obtained admission to a reputable university, either in India or abroad. This includes establishments that have received approval from appropriate authorities, such as colleges, universities, and vocational training facilities.

Also Read: Unsubsidized Loans

Course Qualifications

Numerous courses, including undergraduate, postgraduate, diploma, vocational, and doctoral programmes, are eligible for educational loans. Depending on the course being taken, different eligibility requirements may apply.

Academic Achievement

The applicant should have a positive academic history and meet the minimal educational requirements for the desired course. This typically entails passing the pertinent tests or attaining the required grade level.

Co-Applicant

For education loans, SBI typically requires a co-applicant, who is typically a parent, legal guardian, or spouse. The co-applicant serves as a guarantor for the loan and is typically required to submit income-related documentation.

Also Read: Graduate Student Loan 

Capacity for repayment

SBI evaluates the borrower’s and the co-applicants ability to repay the loan based on their income, assets, liabilities, and creditworthiness. This aids in determining the loan’s size and conditions of repayment.

Collateral

The amount of the loan and the borrower’s profile will determine whether SBI requests collateral or security. Different types of acceptable assets may be used as collateral, including real estate, fixed deposits, and other obligations.

Must Read: Collateral Security

Documents Required

Please be aware that depending on the specific loan scheme and the borrower’s profile, the document requirements may change. For the most accurate and recent information, it is best to contact SBI or visit their official website. The following list of frequently asked-for documents:

  • A properly completed and signed application for the student loan is typically needed. This form can be downloaded from the website or obtained from a bank branch.
  • Proof of Identity: You might be asked to present identification documents like your driver’s licence, passport, PAN card, voter ID card, or Aadhaar card.
  • Proof of Residency: You can provide proof of residency by submitting documents like your Aadhaar card, passport, utility bills, or rental agreement.
  • Proof of Admission: In most cases, you’ll need a document that attests to your enrollment as a student at the institution. This could be a letter from the institute offering admission or making a job offer.
  • Academic Documents: Requests for academic documents, such as mark sheets, certificates, or transcripts, that support the student’s educational credentials may be made.
  • Fee Structure: In order to determine the loan amount and other relevant information, a copy of the fee structure provided by the educational institution is typically needed.
  • Proof of Residency: You can provide proof of residency by submitting documents like your Aadhaar card, passport, utility bills, or rental agreement.
  • Income Proof: SBI may ask the co-applicant to provide income-related documents, such as pay stubs, tax returns, bank statements, or audited financial statements in the case of self-employed people.
  • Collateral Documents: If the loan requires collateral or security, collateral-related documents, such as title deeds, land records, or fixed deposit receipts, may be required.
  • Photographs: Both the student and the co-applicant must provide recent passport-sized photos.
  • Any Additional Documents: Additional documents, such as a statement of purpose, project report (if applicable), or any other pertinent documents, may be required depending on the specific SBI requirements and the borrower’s profile.

Must Read: NSFDC Education Loan

Process to Apply for SBI Takeover of Education Loan Scheme

The following steps could be included in the process of transferring an education loan under the SBI Takeover of Education Loans Scheme:

Research and Qualifications Check

Study and comprehend the SBI Takeover of Education Loans Scheme terms and conditions. Verify that you are eligible to transfer your student loan to SBI by seeing if you meet the requirements.

Application

To start the loan transfer application process, go to the nearest SBI branch or log on to their website. Provide accurate and current information on the required application form.

Documentation

Amass all the paperwork needed for the loan transfer process. These documents could be your current loan agreement, a history of on-time loan repayments, identification and income documentation, academic records, the current institution’s fee schedule, etc. Give everything needed

Also Check Out: SBI Education Loan For Studying Abroad Without Collateral

Loan Evaluation

To determine your eligibility and repayment capacity, SBI will examine your application, supporting documents, and information regarding any existing loans. They will assess the borrower’s creditworthiness and any provided collateral.

Agreement for a Loan

Your loan offer will come from SBI if your loan transfer application is accepted. Examine the terms and conditions, interest rates, time frame for repayment, and other loan characteristics mentioned in the offer. Sign the loan agreement if you accept the conditions.

Settlement of Loan

SBI will work with your former lender in order to pay off the remaining balance of your current loan. To do this, you might need to ask your previous lender for a loan settlement letter or a no-objection certificate (NOC).

Disbursement

Depending on their policies, SBI will disburse the loan amount to your chosen educational institution or directly to your account once the settlement is complete.

Paying back a loan

Start paying back the student loan to SBI in accordance with the pre-agreed repayment schedule. In order to avoid any penalties or charges, make sure to make your repayments on time.

Must Read: Bank of Maharashtra Education Loan

FAQs

1. What happens if we don’t pay the SBI education loan?

If we don’t pay the SBI education loan the lender will start sending notices to you and your guarantor.

2. Can education loans be taken over?

All you need to ensure is that you meet the requirements of the second education loan for other education loans to be taken over.

3. Can I repay the SBI education loan early?

You can prepay an education loan anytime.

With the bank’s extensive network and expertise, it has the potential to revolutionize the way students fund their education, making it more accessible and affordable for all. Follow Fly Finance for more information and updates. 

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