Education loans are financial aids designed to assist students in pursuing higher studies both domestically and
internationally. These loans cover various expenses including tuition fees, books, accommodation, and other
related costs.
Features of Education Loans
Education loans typically come with the following features:
Flexible Loan Amounts: Loans are available for different amounts, catering to diverse
educational requirements.
Interest Rates: Interest rates on education loans are competitive and vary based on the
lender and the loan amount.
Repayment Period: The repayment period starts after the completion of the course, allowing
students some time to secure employment.
Collateral: Depending on the loan amount, lenders might require collateral or co-signers
to secure the loan.
Tax Benefits: Repayment of the education loan can qualify for tax deductions under certain
provisions of the Income Tax Act.
Government Education Loan Schemes in India
The Indian government offers various education loan schemes to support students in pursuing their studies:
1. Vidyalakshmi Education Loan Scheme
Launched by the Government of India, this portal provides a single-window for students to apply for education
loans and scholarships offered by various banks and government bodies.
2. Central Scheme of Interest Subsidy for Education Loans
This scheme provides interest subsidy to economically weaker sections (EWS) during the moratorium period, covering
the course period plus one year or six months after getting a job, whichever is earlier.
3. Padho Pardesh Scheme
The Padho Pardesh Scheme provides interest subsidy to students from the minority communities (Muslims, Christians,
Sikhs, Buddhists, Parsis, and Jains) for pursuing higher studies abroad.
4. State Government Schemes
Several state governments also offer their own education loan schemes with varying interest rates and subsidies
to assist students in their respective states.
