1

Objective

A Central Sector Interest Subvention scheme for financial support to meritorious students so that financial constraints do not prevent any youth of India from pursuing quality higher education

2

Student Eligibility

Nationality:

➤  Student should be an Indian National (including NRI*)

➤  Overseas Citizens in India (OCI*) and students who are born abroad & are now studying in India after repatriation of their parents

*Interest Subvention if any shall be governed by relevant guidelines issued by DHE/DFS, Govt. of India

Admission:

➤  Should have secured admission in the Quality Higher Education Institutes (QHEIs). At present it contains 860 Institutes and shall be reviewed & updated periodically

➤  Admission in these select Premier institutions through common entrance test could be considered a meritorious student

➤  Management or similar quota is not allowed under this scheme

➤  Education Loans for study at these institutes for the given courses shall be sanctioned under this scheme

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Credit Worthiness

➤  The student borrower may not have a credit history and as such he is assumed to be creditworthy

➤  In case of an adverse credit history of student, the student shall be advised to submit reasons for the same. If the satisfactory reply is received and the overdue if any in the loan are regularized before sanction, accordingly loan to be considered

➤  If there is any adverse credit history / default / NPA in the CIR of the co-obligant, another co-obligant acceptable to the Bank to join as joint borrower

4

Courses Eligible

➤  All the Graduation / Post Graduation degree / diploma courses offered by these select Premier Institutes (QHEIs) in India, are eligible

5

Expenses Considered for Loan

➤  Fee payable to college / hostel

➤  Examination / Library / Laboratory fee

➤  Insurance premium for Credit Life Insurance Policy of student borrower

➤  Caution deposit, building fund / refundable deposit supported by Institution bills / receipts

➤  Purchase of books / equipment / instruments / uniforms

➤  Purchase of computer, required for completion of the course

➤  Other expenses required to complete the course - academic, maintenance fees, study tours, project work, thesis, exchange programme, etc.

➤  While computing loan required, scholarships, fee waiver etc., if any available to the student borrower while applying for the loan, may be taken into consideration

➤  If the scholarship component is included in the loan assessment, it may be ensured that the scholarship amount gets credited to the loan account when received from the Government

➤  Other expenses which may not be available in the schedule of fees

➤  Charges prescribed by the college authorities, may be capped maximum at 20% of total tuition fees payable for completion of course

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List of Documents Required: (Student) Applicant

➤  Proof of Identity and Address as per KYC norms

➤  Proof of Academic Records

➤  Proof of admission: Offer Letter or Admission Letter from the Institution. Statement of cost of study / Schedule of expenses

➤  Passport-size photographs

➤  Previous / existing loan, if any, from Banks/Lenders, Branch may obtain suitable documentary evidence

➤  Aadhaar shall be made mandatory

➤  PAN Card is mandatory document

➤  Any other document on case to case basis

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List of Documents Required: Co-Applicant

➤  Proof of Identity and address as per KYC norms

➤  Passport-size photographs

➤  Previous / existing Loans, if any, from Banks/ Lenders, Branch may obtain suitable documentary evidence

➤  Pan Card and Aadhar is a mandatory

➤  Income documents / declaration

➤  Any other document as required to take the credit decision

➤  Proof of Income from designated authorities of the state for claim of interest subvention if eligible

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Quantum of Finance

➤  Maximum Loan Amount: No Cap on Loan Amount

➤  Loan shall be as per Fee Structure of Individual QHEI (Educational Institute)

➤  Need based finance to meet the expenses worked out will be considered

➤  While assessing the quantum of finance, Branch to ensure that the student is neither over financed nor under financed

➤  Branch to ensure that the government scholarships or scholarships from any source are credited to the loan account, if the scholarship amount was not netted off while fixing quantum of finance

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Margin

➤  For Loans upto Rs. 4 Lakhs - Nil

➤  For Loans above Rs. 4 Lakhs - 5%

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Security

➤  Nil

➤  Parent(s) / guardian(s) to be joint borrower(s)

➤  The loan documents should be executed by the student and the parent / guardian as joint borrower

➤  Student will be the primary borrower and parents / guardians will be the co-borrowers

➤  Future income of the student to be assigned to Bank for repayment of loan

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Rate of Interest

➤  RLLR + 0.50% = 9.35% at present

➤  Simple interest to be charged during the study period and up to commencement of repayment.

➤  Servicing of interest during study period and the moratorium period till commencement of repayment is optional for students

➤  Accrued interest will be added to the principal amount borrowed while fixing EMI for repayment

Concession in ROI:

➤  For servicing of Interest During Moratorium: 0.50% from applicable ROI

➤  For Girl Students: 0.50% from applicable ROI

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Repayment

➤  Repayment Holiday / Moratorium: Course period + 1 year

➤  Repayment of the loan will be in equated monthly instalments for a period of 15 years for all categories (excluding course and moratorium period)

➤  No Prepayment penalty will be levied for prepayment of loan any time during the repayment period

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Insurance

➤  It is mandatory to arrange for credit life insurance policy on the students availing Education Loan under this scheme above Rs. 7.50 Lakhs

➤  The policy can be Term Life / Endowment / Group Life Insurance policy also minimum equal to Loan Amount

➤  Existing Policy may also be accepted

➤  Insurance Policy to be assigned in favour of Bank

➤  Insurance Premium may be included in the overall cost of education

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Other Conditions

➤  Sanction of loan to more than one child from the same family:

Existence of an earlier education loan to the brother (s) and/or sister (s) will not affect the eligibility of another meritorious student from the same family seeking Education loan as per this scheme from the Bank

➤  Minimum Age:

There is no specific restriction with regard to the age of the student to be eligible for education loan. However, if the student was a minor while the parent executed documents for the loan, the Branch will obtain a letter of ratification from him / her upon attaining majority

➤  Joint Borrower:

The joint borrower should normally be parent (s) / guardian of the student borrower. In case of a married person, joint borrower can be spouse or the parent (s) / parents-in-law

➤  No Due Certificate:

No due certificate will not be insisted upon as a pre-condition for considering education loan.

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Subsidy / Interest Subvention

*PM-USP CSIS:

➤  Existing Education Loan Interest Subsidy Scheme for Students with family income upto Rs. 4.50 Lakhs for Technical and Processional Courses

➤  Under this scheme, if the course is non-technical and non-professional, student shall be eligible for subsidy @3% as stated above. Subsidy will be available for Loan Amount upto Rs. 10 Lakhs only

➤  If loan amount is more than Rs. 10 Lakhs, interest subvention shall be provided for disbursed total principal amount of loan up to Rs. 10 Lakhs only

➤  Interest subvention @3% only during moratorium period, on the amount disbursed or outstanding whichever is less, shall be borne borne by Govt. of India under interest subvention scheme.

➤  Definition of Family:

The definition of "family", for the purpose of determining the family income criteria in this scheme shall be the student plus her / his father & mother plus her/ his spouse, wherever applicable