Objectives of the scheme:

Providing financial support to those who have the minimum educational qualification, as required by the institution / organization running the course eligible under the scheme.

Student Eligibility:

The Bank will decide financing the students depending on employability and consequent ability to repay the loan.
i) Should be an Indian National.
ii) Passed 10th Standard examination conducted by State / Central Boards
iii) Secured admission in a course run or supported by a Ministry/ Dept / Organisation of the Govt. or a company / society / organization supported by National Skill Development Corporation or State Skill Missions / State Skill Corporations, preferably leading to a certificate / diploma / degree, etc. issued by a Govt. organization or an organization or an organization recognized / authorized by the Govt. to do so. There should be admission system through Entrance Test/Merit based Selection process.
iv) Employability of the course and reputation of the institution.

Courses Eligible:

i) Approved vocational / skill development courses of duration from 3 months to 3 years leading to certificate / diploma offered by a recognized State / Central Govt. Institution or Statutory / technical body or training department of Govt. etc. (e.g.) courses offered by Industrial Training Institutes (ITI), Industrial Training Centres (ITCs) and Polytechnic Institutes etc.
ii) Such courses offered by reputed private education institutes, duly complying all guidelines in this regard issued by Central / State Govt. may also come under financing criteria.

Quantum of loan:

Expenses to be considered for loan:

• Tuition / course fee fixed by Govt. / authorities appointed by Govt.
• Examination/Library/Laboratory Fee.
• Caution Deposit.
• Purchase of Books/Equipments/Instruments/Uniforms.
• Any other reasonable expenses required to complete the course . As these courses are localized, boarding, lodging may not be necessary. However, wherever it has been found necessary, the same could be considered on merit.
• In respect of course fee of private institutes, the expenses shall be limited upto 125% of the fees prescribed by the Govt. for similar courses, if they are not fixed by Govt. / authorities appointed by Govt.
• Life insurance premium of the student, if insurance cover is obtained by him / her.

Margin: Nil

Security:

• No collateral or third party guarantee.
• Parent(s) / guardian will execute loan documents along with the student borrower as co-borrower(s).
• Co-obligation of spouse / parent in law in case of married women.

Interest Rate: (floating rate linked with Bank’s BR)

Upto Rs.1.50 lacs: BR + 2.00% = 12.45% p.a. (at present)
Concession for Girl Student: 0.50% p.a. from card rate. The eligible students will get Interest subsidy as per existing scheme of the Govt. of India.
(The interest shall be debited monthly on simple basis during the repayment holiday/moratorium period and thereafter on compounding basis)
The repayment will commence after a moratorium/repayment holiday, which is course period plus 6 months.
1% interest concession may be allowed to loanee(s) upto moratorium period only if the interest is serviced monthly and regularly during the moratorium period.

Insurance:

Life insurance coverage is provided to education loan borrowers during the tenure of the loan against payment of one time premium under ‘United Shiksha Suraksa’.

Repayment Period:

The repayment will commence after a moratorium/repayment holiday, which is course period plus 6 months.

Charges:

• Prepayment penalty – No penalty will be levied for prepayment of loan any time during the repayment period.
• Penal interest: @2% to be charged for overdue amount and overdue period irrespective of any loan amount.
• Processing Charges / Upfront fees: NIL
• Documentation Charges: Nil