State Bank of India (SBI) is India’s largest bank, and thus, the onus of giving a fluidic loan-based system lies over it. SBI has a wide array of loans available for the students, and all the loans are crafted in a way that makes it a feasible option for students wanting to take an education loan. There are several loans with varying interest rates, which makes it possible for the students to expand their choices of studying within India or abroad without worrying about exorbitant rates of interest.
SBI education loans aim to cover the broadest possible student base seeking a loan by providing varying interest rates and customer-friendly repayment terms. There are different provisions regarding student loans that give them the liberty to pay back the loan within the duration of the loan tenure. To make education gender-neutral, SBI aims to encourage females to pursue higher education by giving concessions on Girl education loans. SBI understands the need to re-skilling the workforce. There are loan schemes for vocational courses, too, a significant shift from old times when loans were restricted mainly to professional courses.
Types Of Education Loan By SBI
|Types of Loan||Maximum Sanctioned Loan Amount||Applicable Interest Rate|
|SBI Student Loan||Rs.20 lakh||8.15% to 8.65%|
|SBI Global ED-Vantage||Rs.1.5 crore||8.15% to 8.65%|
|SBI Take Over of Education Loan||Rs.1.5 crore||8.15% to 8.65%|
|SBI Skill Loan||Rs.1.5 lakh||8.15%|
|SBI Scholar Loan||Rs.40 lakh||6.85% to 8.15%|
The above-mentioned types of education loans give a rough idea of the availability of different loans for a range of students. The cost of a loan varies depending on the principal amount, interest rates, and loan tenure. SBI also provides interest subvention for students, and it helps them in making loans accessible to a large section of society. For instance, an interest concession of 0.50% on SBI Student and Global Ed-Vantage loans is provided for those students opting for an SBI life insurance policy.
SBI is a public sector bank, and India’s government is the biggest shareholder giving concessions on loans sanctioned to the marginalized section of society.
SBI Global Ed-Vantage Loans
Millions of students go abroad every year to pursue higher studies. They need a reliable source of finance to complete their education in time without worrying about the loan. SBI Global Ed-Vantage Loan scheme is one of the best available options for students wanting to go abroad for higher education. The maximum loan amount which can be sanctioned is Rs 1.5 crore. The interest rates also vary from 8.15% to 8.65%. The interest concession is provided for girl’s education and students from marginalized sections of the society via schemes like Dr. Ambedkar Interest Subsidy Scheme for Overseas Studies and Padho Pardesh Interest Subsidy Scheme. Students can also claim additional subvention in the interest rates if they have Rinn Raksha credit life insurance.
The loan amount considers all the expenses of the students and is one of the most holistic loan schemes with such a low rate of interest. The coverage of expenses includes almost everything that may come up in the course of the completion of the course. It takes care of the tuition fee, examination/ library/ lab Fees, round travel airfares, and stationery-related expenses, including textbooks. Global Ed-Vantage scheme also covers the premium of the RiNn Raksha insurance.
One of the noteworthy aspects of the loan is that it is exclusively for students pursuing Regular Graduate Degree/Post-Graduate Degree/Diploma/Certificate/Doctorate Courses. The loan scheme covers almost all the top destinations where the world’s best universities are located, thus giving students the utmost liberty to choose the university and country of their choice. Among the top destinations for higher education, only China is not included in the list of countries while Hong Kong is included. Another aspect of the loan is that it gives a wide loan repayment window of a maximum of 15 years while it depends on other factors.
The collateral which is sought must be a tangible one as it helps the bank to avert any losses in case of non-repayment of the loan amount. However, to make the process easy for those who don’t have collateral on their own, third-party collateral security is also accepted by the banks. In the case of third-party collateral, a friend or a relative can act as a guarantor for the loan by pledging a tangible asset to the bank. This gives a sense of assurance to both the bank and the borrower a sense of security post-sanctioning of the loan amount.
Loan Amount Against A Tangible Collateral
The amount in the Global Ed-Vantage scheme varies on the type of assets that the loan applicant pledges. The total amount that can be possibly sanctioned is roughly 90% of the total cost, including tuition fees, stationery cost, etc. The amount that can be sanctioned usually varies on the liquidity of the asset. The more the liquidity of the pledged assets, the more will be the sanctioned loan amount.
If you are pledging a real estate property, e.g., flats, lands(except agricultural land), the amount that can be sanctioned is roughly around 65%-75% of the property’s estimated value. The approved amount also depends on the duration of the course. The longer the study, the lesser the percentage of the estimated price of the property. However, if a liquid asset is pledged, like Fixed Deposit, Government Securities, etc. will fetch you a higher loan amount, and one can easily get 90% of the total value of the liquid asset being pledged.
SBI education loan is one of the most affordable and easily sanctioned loans. One of the most significant advantages is that SBI is a public sector bank that makes it possible for students to take the loan without paying an exorbitantly higher interest rate. An extended repayment time period of 15 years and a rate of interest range of 8.15%-8.65% are the biggest addendum to the Global Ed-Vantage scheme.