How can an Indian student bag an education loan?

How can an Indian student bag an education loan?

This article comprises various ways and techniques through which an Indian student can bag an education loan in this competitive market.

In the Indian education loan market, Public Sector Banks play a dominant role. An RBI data shows that the Public Sector Banks hold over 91% share in lending to the education sector. A bank will extend a loan of up to a certain amount without collateral depending on where an institution figures in its preference lists.

Candidates whose institutions are not covered by any list can apply under the Student Loan Scheme. This scheme offers a higher interest rate and loans above Rs. 7.5 lakh require collateral. Education loans are linked to the repo rate. With the increase in repo rate, loan rates will also increase. Moreover, rates at private sector banks tend to be higher.


  • The candidate must be a resident of India.
  • The applicant must have confirmed admission to a recognized educational institution in India or abroad.
  • The candidate must undergo a graduate/PG degree or a PG Diploma.
  • A student who is pursuing full-time courses must have a co-applicant who can be a parent or spouse or guardian or parent-in-law.
  • The co-applicant must possess a regular income source.
  • A strong academic record can facilitate speedy loan approval.

Criteria to boost your Eligibility

  • High grades in the qualifying exams.
  • Good academic record.
  • Admission to a reputed institute or university.
  • Strong financial background of the co-applicant.
  • Good prospects for future employment and income generation.

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