New Delhi (Education Loan for School Fees). These days the top schools of the city have gone away from the reach of common people. Along with metro cities like Delhi, Mumbai, Noida, Bangalore, it is becoming difficult to pay the fees of schools located in Tier 2 and Tier 3 cities. The school fees do not seem to be possible, but if you want, you can get the first class education to your child by taking a school education loan. For this, you should know eligibility and other important details.
Education loan facility can also be taken for school education (from nursery to 12th standard) in India. People usually take loans for higher education (graduation, post-graduation). The loan taken for school fees is less prevalent than them. However, State Bank of India, Bank of Baroda Bank like government banks and private banks like ICICI, HDFC and some financial institutions also provide loans for school education.
School education loans cover tuition fees, books, uniforms, hostels and other school-related expenses of schools. School Education loan It is mainly designed for families who feel difficulty in charging high fees or other education-related expenses of private school. Most of the top private school fees are in millions. In this situation, needy parents can take education loans from banks and NBFCs (non-banking financial companies).
School Education Loan Eligibility: Who can take school education loan?
School loan amount and conditions may be different from the loan for higher education. Many banks provide a low amount (up to Rs 4 lakh) without any security, while a large amount may require collateral (eg property).
Eligibility for school education loan
The eligibility conditions for taking loans for school education may vary according to the bank. Below are some common conditions as follows:
Indian citizenship: The applicant (student or guardian) should be an Indian citizen. Some banks also give loans to NRI (NRI) students (if they have a valid Indian passport).
Student age: Loans for school education are usually available for students between 3 and 18 years of age. Some banks keep the minimum age limit of 16 years.
School admission: The admission of the student should be in a recognized school (CBSE, ICSE, State Board or International Board). Banks check the reputation and recognition of the school.
Coal-Applicant: Parents (parents or legal parents) have to join as a co-applicant for school loans. It is necessary to have regular income (salary, business or other source) of co-applicant.
Income limit: Under some government schemes like Central Sector Interest Subsidy (CSIS), the annual income of the family should be up to Rs 4.5 lakh. However, private banks can increase this limit up to Rs 8 lakh.
School Education Loan Limit: School Education loan limit
The loan amount for school education is usually up to Rs 4 lakh. But some banks also provide loans up to Rs 10 lakh. No collateral or third-party guarantee is required for loans up to Rs 4 lakh. Guarantee is provided under Credit Guarantee Fund Scheme for Education Loans (CGFSEL) for loans up to Rs 7.5 lakh. This amount covers the expenses mentioned below:
Tuition fees, hostel fee and examination fee.
Books, uniforms and other educational materials.
Laptop or other equipment, if necessary for school.
Travel expenses, if the student is studying in boarding school.
Documents required for education loan
Some compulsory documents have to be submitted for the loan:
- Student’s documents: Aadhaar card, PAN card, passport size photo and evidence of school admission.
- Co-applicant documents: Aadhaar, PAN, Income Proof (ITR, Salary Slip) and Bank Statement.
- School related: Fee structure, bill and recognition certificate.
- Security (if applied): Property documents or other collateral papers.
Education Loan by Government: Government Schemes and Subsidies for Loan
Schools who take loans for school education can take advantage of some government schemes.
PM-Vidyalakshmi Yojana: This scheme provides loans without collateral to meritorious students. Families with income up to Rs 8 lakh get 3% interest subsidy.
Central Sector Interest subsidy (CSIS): Families with income up to Rs 4.5 lakh receive interest subsidy during the loan Mooretorium period (course duration + 1 year) of the loan.
Vidya Lakshmi Portal: Through this portal, students can apply for loans in many banks with the same application.
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