Education loans allow easy access to higher education without disturbing your finances. An education loan is generally taken by students (or parents) to meet expenses such as tuition fees, hostel expenses, and other related costs while pursuing a higher educational course. Banks offer education loans for students pursuing specified courses across India or overseas. 

Banks that offer education loans publish a list of courses and institutions that are eligible. If the course and institution you want to enrol in is included in the bank’s list then you can seek an education loan from that bank. If an education loan is taken by unemployed students, their guardian or parents must act as guarantors to the loan.

Education Loan - Interest Rates at Top Banks

Bank / Lending Inst Loan Amount Interest Rate

Axis Bank

Maximum of Rs. 4 Lakhs 15.20%
Loans ranging from Rs. 4 Lakhs to Rs. 7.5 Lakhs 14.70%
Loans more than Rs. 7.5 Lakhs 13.70%
Bank of Baroda For all loan amounts 8.50% onwards

Canara Bank

Vidya Turant Loan Scheme 6.60%
Up to Rs. 4 Lakhs 10.40%
Rs. 4 Lakhs to Rs. 7.50 Lakhs 10.40%
Loans greater than Rs. 7.50 lakhs 10.20%
IBA´s Model Loan Scheme for Vocational Education & Training 9.90%


Minimum APR 9.00%
Maximum APR 13.86%
Average APR 11.57%
Kotak Mahindra Bank For all loan types and amounts 11.5% to 24%

Punjab National Bank

PNB Kaushal 8.55% onwards
PNB Saraswati/Udaan 10.30% onwards
PNB Pratibha (applicable to admission in IITs, IIMs and XLRI Jamshedpur) 8.45% onwards
PNB Pratibha (applicable to admission in other colleges) 8.55% onwards
PNB Honhaar 10.45%

State Bank of India

Up to Rs. 7.5 Lakhs 10.25%
Above Rs. 7.5 Lakhs 10.50%
Avanse For all loan types and amounts 10% to 16.50%
Credila For all loan types and amounts 11.85% onwards



List of Banks that are Best for Education Loans in India

Salient Features of SBI Education Loans 

SBI education loan is offered minus processing fee. It comes with a repayment period of maximum 15 years after completion of the course period. SBI offers education loans of maximum Rs 20 Lakhs for multiple courses and universities.

  • For loans up to Rs 7.5 Lakhs – the interest rate is 10.25% p.a.

  • Above Rs. 7.5 Lakhs – the interest rate is 10.50% p.a.

  • 0.50% interest rate concession for girl students

  • 0.50% interest rate concession for students who opt for SBI Rinn Raksha or other existing policy as categorised by SBI

  • 1% concession throughout the loan tenure, for students who service the interest promptly if applied in the moratorium period. This includes course duration

  • IT exemption can also be availed under Section 80(E) with regards to interest paid

Salient Features of Indian Bank Education Loan 

Indian Bank provides education loans that covers the cost of education including fees payable, exam fees, cost of books/equipment, travel expenditure for overseas studies, cost of computers if essential for the course, etc. For meritorious candidates, the bank offers a loan amount that can be further increased. 

  • Education Loan for premier Institutions List A – the interest rate is 8.60% 

  • Education Loan for premier Institutions List B – the interest rate is 9.20% 

  • Education Loan for premier Institutions List C – the interest rate is 9.60% 

Salient Features of Canara Bank Education Loan 

Canara Bank offers education loans with zero margins and even 100% finance up to Rs 4 Lakhs. The bank offers loans to multiple co-borrowers under the same loan blanket so that beneficiaries can avail the maximum loan amount. Loans up to Rs 4 lakhs can be availed without any collateral requirement and up to Rs 7.5 lakhs can be availed with third party guarantee. Loans above Rs 7.5 lakhs can be taken by making an adequate collateral submission.

  • Vidya Turant Loan Scheme – for IIT, IIM, ISB - 6.60% interest rate

  • Loans up to Rs. 4 lakh – 10.40% interest for courses in India, abroad, or at IIT, IIM, ISB

  • Loans Rs. 4.0 – 7.5 lakhs - 10.40% interest for courses in India, abroad, or at IIT, IIM, ISB

  • Loans greater than Rs. 7.5 lakhs - 10.20% interest for courses in India, abroad, or at IIT, IIM, ISB

Salient Features of Andhra Bank Education Loan

Andhra bank provides education loans for pursuing higher studies in India or abroad. Educational loans are also available for pursuing vocational courses. The bank does not have any age-related restriction for availing education loan. 

  • Loan up to Rs. 7.50 Lakhs – MCLR (one year) + 2.00 %

  • Above Rs. 7.50 Lakhs – MCLR (one year) + 1.70 %

  • 0.50% concession is offered to girl students.

  • Interest rate concessions can also be availed by students who are pursuing their education at certain premier institutions.

  • Simple interest is charged throughout the study period until the beginning of repayment.

  • Accumulated interest is compounded at the beginning of repayment tenure. The applicable EMI is decided accordingly.

Salient Features of PNB Education Loan 

Education loan offered by PNB allows students to meet their educational expenses such as tuition fees payable, examination fee, insurance cost etc. Here is the list of the interest rates for each of the education loans offered by the bank:

  • PNB Kaushal - 8.55% and above

  • PNB Saraswati / Udaan - 10.30% 

  • PNB Pratibha (applicable for IITs, IIMs and XLRI Jamshedpur) - 8.45% onwards

  • PNB Pratibha (other colleges) - 8.55% onwards

  • PNB Honhaar - 10.45%

Documents Needed for Education Loan Application 

Here is a generic list of documents that need to be submitted in most banks / financial institutions while availing an education loan:

  • Application form (filled in), two passport-sized photographs of applicant and co-applicant.

  • Original admission letter from the Institute. It must include the institute name and address and must be printed on the institute’s letterhead.

  • A detailed fee/cost breakup of the course as provided by the Institute. This must include the tuition fee, course term, year-wise fees and expenses.

  • A detailed academic record of the student applying for the loan. This must include the 12th marksheet, certificate of graduation or post-graduation, score sheet of the entrance exam as applicable, and any scholarship proof.

  • A self-declaration that no loan has been sourced from any other bank for education purposes.

  • ID proof including PAN card, Aadhar card, Driving License, passport, etc.

  • Address proof such as Ration Card, Driving License, Passport, Aadhaar Card, etc

  • Age proof like Birth Certificate or 10th Class certificate.

End Note

Banks in India provide various schemes for education loan and students can make the most of these depending on the institute and course of study selected. Most of these have flexible repayment options thereby allowing the student to plan his finances. Education loans also come with a moratorium period which allows the borrower about six months after course completion. Loan repayment can begin after this period or earlier in case the borrower finds a job or source of income.