Education Loan For MBA: Everything about MBA Education Loan
The MBA is the most popular master’s degree among Indian students, with over 2,10,000+ aspirants appearing for CAT, with approx 30,000 GMATs working in India.
The decision to pursue an MBA requires a significant amount of financial planning due to the rising cost of education.
An MBA is an expensive program and it is difficult to pursue your MBA education without finding ways to finance an MBA.
Now, most of the top MBA colleges have increased their MBA fee. Therefore, funding your MBA is a major area that you have to think about before taking admission in MBA college.
The MBA tuition fee for top B-schools like IIM, MDI Gurgaon, XLRI Jamshedpur is between Rs. 18 lakhs to Rs. 22 lakhs.
When you have applied for an MBA and are eagerly awaiting your offer letter, use this time in free time to do thorough research about education loans.
In addition to this tuition fee, you will have to pay other expenses like living expenses during your MBA program, onboarding, and personal expenses.
About 80% of MBA students take education loans. Therefore, planning and securing your education loan for MBA is as important as getting admission yourself! This article from MBAUniverse.com will help you understand about MBA education loan.
If we think of a well-planned and sound process, we can not only get the money required to pursue our dream MBA but also save a lot of money while studying.
Today, loans for MBA courses are available with almost all major banks. Some banks also have tie-ups with some major institutions. These banks offer a special rate of interest to the students which are normally lower than the interest rate. You may have some apprehension that education loans are complicated monsters. But don’t worry.
There are Various education loan options, steps to get education loans from various nationalized and private banks for top MBA loan providers and MBA education.
Eligibility For MBA Education Loan
You can visit your bank and discuss your educational loan requirement to do MBA. Your selection letter should be issued by the institution from which you intend to do an MBA and your educational qualification starts from 12th standard. The basic criterion about the qualification is that the candidate must have a consistently excellent academic record (first class). The credit manager or branch manager will tell you the security requirement based on the amount of loan required, your margin contribution, rate of interest and repayment, etc.
Age Eligibility Criteria For MBA Education Loan
- The age of the joint applicant / co-borrower / guarantor should be a minimum of 21 years at the time of loan origination and the maximum age at the time of loan maturity can be 70 years.
- There are no special restrictions regarding the age of a student to be eligible for an education loan.
Student Eligibility For Education Loan
- The student must have gained admission in India or abroad through an entrance examination or through a merit-based selection process.
- The student must be an Indian national.
Institute’s eligibility for Education Loan
- International colleges and universities
- Professional institutions
- Recognized institutions and government colleges
- Private institutes aided by government
In such cases, some private banks and education loan providers such as Credila and Avance may also call themselves students. Contact details of students are often shared by the institution with the banks and loan providers they collaborate with. This makes easier because the bank can sometimes come to the customer’s doorstep to complete the loan processing formalities.
Expenses covered under Education Loan
Apart from tuition fees, the student has to face other expenses during the MBA. An education loan covers full of the basic course fee.
One of the loan schemes offered by the State Bank of India (SBI), called the SBI Global Ed-Vantage Loan Scheme, provides loans to students ranging from Rs. 20 lakhs to Rs. 1.5 Crore with 9.5% to 10% interest rate. Under the SBI Global Ed-vantage Scheme, one can get 90 percent coverage for expenses like tuition fee, entrance fee, etc. and the remaining 10 percent should be borne by them.
Generally, the bank can also cover other related expenses while lending, such as:
- Examination, Library and Laboratory fees
- Fee payable for college (tuition fee) and hostel
- Books, equipment and other study material
- Expenses for traveling abroad, money spent
- Purchase of laptop, the computer is necessary for the completion of course
- Refundable deposits backed by caution deposits, building funds, institution bills or receipts.
- Even the cost of a two-wheeler is covered as part of the education loan by leading banks.
- Any other expenses required to complete the course – such as study tours, project work, thesis, etc.
Documents required to Apply for MBA Education Loan
- Loan application in bank’s format
- Passport size photos
- Address and age proof if you are not an existing bank
- Proof of admission to the course
- Customer copies of mark sheets in the qualifying exams
- Schedule of expenses for the course (course prospectus where the course fee is mentioned)
- Statement of Bank account for the last six months of borrower/co-borrower
- Income tax assessment order not more than two years old (students or parents’)
- A brief statement of assets and liabilities of the borrower.
Fee Structure of MBA
|S.N.||Colleges Name||Fee in Lakhs|
|10.||IMI New Delhi||16.95|
|13.||K J Somaiya Mumbai||13.66|
MBA Education Loans Choices
You have a number of MBA education loan options. However, at different interest rates, the cost of these MBA education loan options can go up or down and you have to take care of this problem.
Education loans for MBA in India are given by public sector banks like State Bank of India, Punjab National Bank, Central Bank of India, Punjab & Sind Bank, Dena Bank, Canara Bank among other banks.
Another MBA education loan option is to obtain education loans for MBA from private banks such as ICICI Bank, Axis Bank, Kotak Mahindra Bank, and Non-Banking Finance Companies (NBFC), such as Credila Education Loan, among others. Avance Financial Services.
This is important that most financial institutions offer differential interest rate schemes for education loans for MBA.
Education loans for IIMs and higher ranked MBA colleges are generally available at lower rates than lower-ranked colleges.
Loan Providers in India to Study MBA
The list of MBA education loan provider in India is mentioned below including interest rate, loan amount and repayment tenure.
Allahabad Bank Education Loan
The educational loan scheme aims to provide financial assistance from the banking system to meritorious students for pursuing higher education in India and abroad.
The PA meritorious student, though poor, is provided with the opportunity to pursue education with financial support from the banking system, with affordable conditions and conditions.
After completion of HSC (10 plus 2 or equivalent), one should get admission in higher education course in India or recognized institutes through entrance test / merit-based selection process.
Where the admission is purely on the basis of marks obtained in the qualifying examinations, the cut-off mark for credit eligibility is 50%.
Meritorious students admitted under the management quota are also eligible for the loan.
Studies in India (Indicative List):
UGC / Government recognized course. / AICTE / AIBMS / ICMR etc.
For job oriented professional/technical courses offered by reputed universities.
Fees payable for college/school/ hostel and other related expenses.
Study in India:
Up to Rs.75 lakhs depending on the institute. (The list of institutions is available on the bank’s website.)
Rs. 75 lakhs.
The loan documents must be jointly executed by the student and parent/guardian as the joint borrower.
If his or her income is considered for eligibility, the spouse must be a co-borrower. No collateral, no guarantee.
Up to Rs.4 lakh – No collateral security
Above Rs.4 Lakh – Security (depending on course/institutes) varies from third party guarantee, parental no-obligation, full collateral security.
up to 15 years
Axis Bank Education Loan
Axis Bank brings you education loans for studies in India and also in abroad. Maximum up to Rs 50,000. 75 lakhs, at attractive interest rates. With an Axis Bank Education Loan, you can enjoy many benefits such as simple documentation, quick loan disbursement, tax benefit U / S 80 (E), long repayment period, and more.
- Indian Citizenship
- Secured at least 50% marks during HSC & Graduation
- Who have obtained admission to career-oriented courses e.g. Medicine, Engineering, Management etc., either at the graduate or post-graduate level
- Secured admission in India or Abroad through entrance test / merit based selection process post completion of HSC (10+2)
- Documents displaying regular income is mandatory for the co-applicant( parents/sibling/guarantor)
- KYC documents
- Bank Statement / Pass Book of last 6 months
- Optional – Guarantor Form
- Copy of admission letter of the Institute along with fees schedule
- Mark sheets / passing certificates of S.S.C., H.S.C, Degree courses
- Demand letter from college or university
- Loan agreement signed by applicant, co-applicants
- Sanction letter signed by applicant, co-applicants
- Disbursement request form signed by applicant, co-applicants
- Receipts of margin money paid to the college / university along with bank statement reflecting the transaction
- Documents for collateral security (if applicable)
- Form A2 signed by applicant or co-applicants in case of overseas institute
- Up to 4 Lakhs – 15.2 %
- 4 Lakhs to 7.5 Lakhs – 14.7%
- More than 7.5 Lakhs – 13.7 %
Axis Bank provides education loans to students belonging to economically weaker sections as per the interest subsidy scheme of the Central Government. Get more information about education loan subsidy scheme offered by Axis Bank below:
Government of India, Ministry of Human Resource Development has given letter no. F. 11-4 / 2010 – U.5 (i) dated 25 May 2010 plans to provide full interest grant during the period of moratorium, ie the duration of the course and after one year or six months, whichever is earlier. The scheme is available for education loans belonging to Economically Weaker Sections (EWS) (where the annual parental income from all sources is up to Rs 4.5 lakh), which is under the Model Educational Loan Scheme approved by the IBA, to pursue any for. Approved courses of study in technical and professional streams from recognized institutions in India.
Salient Features of Education Loan Subsidy Scheme:
The scheme is applicable to all students who meet the eligibility criteria of the IBA approved Model Educational Loan Scheme, subject to compliance with the terms of the Interest Subsidy Scheme. The scheme is applicable only for studies in India and is available for educational loans up to Rs. 7.5 lakhs.
The amount of disbursement made on or after April 1, 2009, will be borne by the Government of India while the interest payable by the student related to EWS and satisfying the eligibility criteria of the scheme.
Under this scheme interest subsidy will be available only once to eligible students – for undergraduate courses or postgraduate degree / diploma courses in India. Integrated courses (combined undergraduate plus postgraduate) will also be considered under the scheme.
The interest subsidy under the scheme will not be available to those students who discontinue the course midway, or who are expelled from institutions on disciplinary or educational grounds. Interest grant is allowed, in case of exemption on medical grounds for which necessary documents are submitted to the satisfaction of the head of the educational institution.
For the purpose of this scheme, the State Government has designated a competent authority or authority to issue income certificate based on the economic index and social background.
The interest rates charged on the loan will be as per the interest rates applicable under our education loan subsidy scheme.
The list of recognized universities / institutes and recognized vocational courses, which are administered by the Ministry of Tourism and are eligible for interest subsidy scheme, has been updated on our website. To see the list,
The list of technical / professional courses for which the scheme is applicable will be promoted from time to time by the UGC and AICTE and will be immediately displayed on their websites, which can be accessed for verification purposes.
The following documents should be submitted at the time of sanction of loan: Income certificate issued by the appropriate authority / authorities specified by the concerned State Government.
Bonafide Student Certificate: If the student is qualifying for the subsidy scheme, the interest subsidy agreement, the Letter of Undertaking Less Declaration, needs to be signed by the borrowers.