SBI Education Loan

Under the special schemes of SBI education loans abroad, the bank offers financial support to cover various academic expenses, including tuition fees and living costs.

With flexible repayment plans and competitive interest rates, these schemes ensure that students can pursue their educational goals without any financial burden.

* You will get complete details about SBI Rinn Raksha in the later section of this article. Keep reading for a better understanding.
** Apart from the SBI education loan processing fee, If students are taking a loan with collateral, then they will have to pay an additional amount between Rs 7,500 to 10,000 for their legal and valuation reports.

But, WeMakeScholars being a government-funded initiative, does not charge any type of fees from its students. Yes, all our services related to educational assistance, and loan sanctioning are free of cost. To avail benefits of our student-friendly services, request a callback or fill out the SBI education loan form. 

If you are facing any problem understanding any terms or schemes, you can just write your queries in the comment down below.

Acceptable Collateral

• Immovable property - Non-agricultural land, building, flat
• Liquid security - Govt. bonds, LIC policies, Fixed deposits

Value of collateral

• In the case of Immovable Property - The minimum value of the collateral should be more than the asked loan amount. So, we often suggest students keep a collateral value of approx 1.25 times the asked financial aid for all schemes except 110% for the SBI Shaurya Education Loan scheme.
• In the case of Liquid Security - The minimum value should be equal to the asked loan amount.

Acceptable Co-Applicant

The co-applicants must be the parent(s) or guardian, siblings, parent’s siblings, or first cousins of the student borrower. If the borrower is married, the co-applicant can be the spouse or the parent(s) or parents-in-law.

Repayment Policy

In all the schemes mentioned above, you will be charged Simple Interest during the moratorium period, however it is optional to pay. You can opt out and start your EMI after the moratorium period ends.

Eligible Courses

• Graduation: For job-oriented professional/ Technical courses offered by reputed Institutions
• Post-graduation: MBA, MCA, MS, etc. Job-oriented technical/ professional courses
• Post Graduate Diploma/ Certificate courses offered by reputed Institutions
• Degree/diploma courses like pilot training, aeronautical, shipping, etc.
• Doctorate Programmes (Ph.D.)
• Courses conducted by the Chartered Institute of Management Accountants in London, Certified Public Accountants in the USA, etc.
  

State Bank of India offers collateralized academic loans to students to take admission to top colleges and universities in popular study hubs like Hyderabad, Andhra Pradesh, Mumbai, Karnataka, Tamil Nadu, West Bengal, Delhi, Gujarat, Pune, Jaipur, Kerala, Goa, Amritsar, Jharkhand, MP and Chattisgarh.

In this section, you will get to know all the minute details of the SBI Education Loan Scheme for Study in India which is very hard to find all together in one place. Let’s get started.

Note- If you're looking for information on Acceptable Collateral, Collateral Value, Acceptable Co-Applicants, and Repayment Policies for these schemes, simply scroll up to find the section titled 'SBI Education Loan Scheme for Study Abroad.' There, you'll find all the details you need, as these parameters remain consistent for both studying abroad and within India.

Eligible Courses

• Completion of undergraduate and graduate studies, including standard technical and professional programs offered by colleges/universities endorsed by UGC/AICTE/IMC/Government authorities.
• Participation in standard degree/diploma programs offered by autonomous institutions such as IIT, IIM, etc.
• Completion of teacher training/nursing courses sanctioned by either the Central or State Government.
• Enrolment in standard degree/diploma programs like Aeronautical studies, pilot training, shipping, etc., approved by the Director General of Civil Aviation/Shipping authorities.

Eligible Courses under SBI Skill Loan Scheme

• Training institutions or courses eligible for a Skilling Loan include:
  
  • Industrial Training Institutes (ITIs)
  • Polytechnics
  • Training partners associated with National Skill Development Corporation (NSDC) or Sector Skill Councils
  • State Skill Mission or State Skill Corporation
• Preferably, these courses should result in a certificate, diploma, or degree issued by the respective organization according to the National Skill Qualification Framework (NSQF).
• Schools recognized by Central or State Education Boards, as well as colleges affiliated with recognized universities, are also eligible for a Skilling Loan if they offer certificates, diplomas, or degrees according to NSQF.

NOTE -  There is no minimum duration requirement for the courses.

Be sure to watch the 5th episode of Loanflix, where our co-founder provides a comprehensive overview of the essential fundamentals you need to know when applying for an SBI Abroad study loan.

A lot of students who wish to study abroad with the help of an SBI loan are not aware of the types of collateral security that are majorly accepted by the bank for both SBI loan schemes. The types of collateral listed in this article are acceptable not only by the SBI but also by almost all major government banks that offer an abroad study loan. In any secured loan process, it is essential to get a rough idea about the three major types of collateral that are accepted by all banks.

Immovable Property: An immovable property is one of the most frequently pledged categories of assets as collateral against an abroad study loan. It involves assets like a house, a residential flat, a plot with defined boundaries, an independent house, a non-agricultural land, etc.

Liquid Security: Did you know that government banks do accept liquid assets as collateral against an abroad study loan? Assets such as Fixed Deposits, government bonds, life insurance policies from government-approved lenders, etc. are accepted by government banks like the SBI, BoB, etc. as collateral security.

Third-Party’s Assets: In case a candidate does not have any of the above assets or if their values do not cover the required student loan amount, then they can pledge a third party’s assets as collateral security. This third party essentially refers to individuals who are not part of the candidate’s immediate family. E.g., uncle, aunt, friends of the candidate or the primary co-applicant, etc.

Now that you have gained a sufficient understanding of the three major types of collateral that are accepted for an SBI loan, let us take a look at the legal acceptability of these categories of assets.

Immovable Property

As mentioned in the previous section, immovable property is one of the most commonly pledged assets in the loan process. Despite having an immovable property whose value meets the requirements given by the SBI, a lot of candidates are still not able to get loans easily. A major reason for this is that many of them are unaware of the legal restrictions on the immovable property owned by their co-applicants. 

Before sanctioning a loan against immovable property, many government banks, including the SBI, consider certain factors of the property that has been pledged as collateral security. 

• If the property was co-owned before and has been divided between two people of the same family, then it has to have clear, defined boundaries separating both sides.
• If the property in question is part of a bigger plot that was later divided into different sections, then applicants will be required to submit the registration documents of the bigger plot or the motherland.
• If the property being pledged as collateral was gifted to the candidate or their co-applicants, then the gift deed of the property has to be submitted. The gift deed and Will should have been registered and the property should be registered in the new owner's name. 
• If the value of the loan or that of the property being pledged as collateral exceeds INR 1 Cr., then the bank will require two legal and two valuation reports.

Immovable Properties not Accepted for an SBI Education Loan

Here is a list of properties that are not accepted by the SBI for study loans under any conditions.

• Agricultural lands are not acceptable, even if someone has built a house on them, it is still not acceptable. If that area is converted to residential, then get a “conversion document”.
• Gram panchayat properties are not usually acceptable. Property has to be under a Municipal Corporation. According to the SBI circular, Gram Panchayat property is not accepted. 
• Cantonment Area property is not acceptable.  It includes- temporary quarters for troops and a permanent military station in India.
• Properties used for social causes like a hospital, a school, etc can not be pledged.

Immovable Properties Accepted by SBI for Student Loan

• The bank prefers immovable properties located in cities as opposed to those located in rural areas.
• Residential properties are given greater preference than commercial properties, so it is recommended that you use commercial property as collateral only if you do not have a residential property.
• Empty lands are often less preferred by most SBI bank branches. Properties that have a building/house on them are often accepted for SBI loans.
• If you plan on pledging an empty plot as collateral, candidates need to know that plots whose boundaries are clearly defined are given preference over those that do not have one.

Note: Even within the cities, SBI only accepts properties that fulfil certain criteria. Read one of our previous articles where we've mentioned the City-specific collateral requirements to know more.

Liquid Security

Unlike immovable properties, SBI has set relatively easier criteria for liquid security which is being used as collateral against a loan. The following Liquid assets that fulfil the following criteria can be accepted as collateral against student loans.

Third-Party Collateral

A student may pledge both immovable properties as well as liquid assets belonging to a third party as collateral security against student loans. 

Note- It is important to understand that the loan taken against third-party collateral and loans against FD which is less than 6 months old are not accepted as funding proof by the embassies of Australia and New Zealand.

The process of getting a government bank education loan in India is considered by many students to be a painful affair because very few students have a good knowledge of some of the basic student aid concepts. To know more about the different factors of an easy loan process, do get in touch with WeMakeScholars.

Offline Application Process

• Visit your nearest State Bank of India branch, and ask about the education loan products from the branch manager
• Check your loan eligibility and, fill out the application form 
• Ask for the document checklist
• Visit the bank again to submit the documents, to get your education loan process started

Online Application process with WeMakeScholars

• Get in touch with your financial officer, by requesting a callback or filling up the SBI education loan form.
• Provide your loan requirement details to your financial officer, over call.

After analyzing your eligibility, your financial officer will connect you to the best education loan lender, so that you can start your online application process to get an SBI education loan, at the earliest.

• Submit your documents on the WeMakeScholars documents portal, to start your loan process
• Your financial officer will take care of the process from here, you can get updates from them regarding your loan sanctioning process.
• You can get your loan sanctioned within 15-20 days from the date you submit your documents.

The process of applying for an education loan is already simple, and it further gets simplified if you process your education loan with WeMakeScholars because here you will get the following benefits:

• Expert guidance: After analysis of your loan profile, your financial officer will connect you with the best possible lenders, as per your eligibility, and guide you at every step of the process.
• Minimal Processing time: A student loan from a public bank will get sanctioned in around 21 days and it would take around 7 days to get a sanction letter from a private bank or NBFC, both deadlines are 50% less than the usual processing time.
• Negotiation support: Whenever possible, your financial officer will try to negotiate on your behalf with the lender's team, to get you the best possible deal.
• End-to-end support: Your financial officer will stay with you even after your loan is sanctioned, to help you in disbursement and even while repayment. even when you are on the opposite side of the earth.
• Better Interest rates: We are the largest loan partners of the banks in India and that is why, the interest rates when students process their through WeMakeScholars are 0.5% to 2% lower than the bank’s average.
• Free of cost services: All our services are free of cost for students as we are funded and supported by the IT Ministry under the Digital India Campaign.
• Digitized application process: Our online application process makes it hassle-free for students to apply for education loans. Moreover, the WeMakeScholars documents portal reduces the stress of going multiple times to the bank just to submit the documents.
• Tax benefits: We make sure that you save maximum tax by taking advantage of Section 80E, 80C, etc of the Income tax department, along with the tax collected at source (TCS).
• Cashback offer: You stand a chance to get a cashback of up to Rs 3,000 from us, at the time of your loan disbursement.

The education loan repayment process in SBI Bank starts after the moratorium period ends, however, students (if they are willing to) can pay simple interest on their taken loan amount in the moratorium period as well. But the real EMI starts only after the moratorium period ends. 

Though there is an SBI EMI calculator, if you use the WeMakeScholars EMI calculator you will get the most detailed EMI calculation. Let’s understand with an example: 

Suppose a student takes a loan of say Rs 40 lacs at a 10% rate of interest for 15 years of duration to study abroad. Then the student will have to pay their EMI as per the following amortization schedule

This is just an example, your amortization table will depend on your loan amount, rate of interest, and repayment period. To seamlessly process your higher studies loan from the State Bank of India, while getting the best study loan deal in the comfort of your home, request a callback or fill out the SBI education loan form on our website.