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Education Loan
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Government of India in consultation with Reserve Bank of India (RBI) and Indian Banker's Association (IBA) has framed a new Comprehensive Educational Loan Scheme. The scheme covers all type of courses including professional courses in schools and colleges in India and abroad.
 
The Salient features of the scheme are as under:
  • The scheme envisages loans up to Rs.7.5 lakh for studies in India and up to Rs. 15 lakh for studies abroad.
  • For loans up to Rs. 4 lakh no collateral or margin is required and the interest rate is not to exceed the Prime Lending Rates (PLR). For loans above Rs. 4 lakh the interest rate will not exceed PLR plus 1 percent.
  • The loans are to be repaid over a period of 5 to 7 years with provision of grace period of one year after completion of studies
Tax Benefit:-

Repayment of an education loan is deductible under section 80E of the Income Tax Act. The yearly limit for deduction is Rs. 40,000 (for both the principal and the interest). Only loans taken for higher education - fulltime studies in any graduate or post-graduate, professional, and pure and applied science courses - may claim deduction. The deduction will be available for a maximum of eight years starting from the day you start repaying.

Provided below are various links to respective nationalized bank websites that offer education loan for studies in India and abroad.

 
 
Disclaimer: The rules, regulations, eligibility conditions, repayments and interests rates etc are revised by the banks from time to time in keeping pace with the changing capital market conditions. Students and parents are advised to thoroughly check the terms and conditions of educational loan scheme on offer at the time of application.
 
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