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City Union Bank provides education loans at no hidden costs and administrative charges. Get to choose from different EMI payment methods. No security is required for up to 4 lakhs. Low interest rates provided. Apply now through CreditMantri!
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What Is an Education Loan?
An Education loan is the loan or funds acquired by an individual to pursue higher studies in India or abroad. The loan repayment commences for the student after completing the education and a period of 6 months is given as grace period to students to get or join a job.
The repayment amount will be determined by your choice of interest, you need to decide how you want to repay the loan. That is if you want to start paying during the time of moratorium period itself or after the moratorium period. The Moratorium period is the time of your education plus 6 months or 1 year given to get a job. It is only after this time that you are expected to pay the loan.
The loan interest starts to accrue at the time of dispersal of funds, so at the time of your graduation you have a huge amount to repay. The other option is your parents or guardian can start paying the loan during the moratorium period itself where it is calculated as a simple interest.
This way your loan amount at the time of graduation is drastically reduced.
There are 4 types of education loans in India
1. Under Graduate education loan - These are given to students who have completed their secondary education and looking to do higher studies in the form of under graduation. It can be done in India or abroad.
2. Post graduate education loan - These are education loans given to individuals who want to pursue post-graduation after completing under graduation course from a reputed university/college. Here also the loan can be for studying in India or abroad.
3. Parents availing education loan - This is the case where the parents take loan for the education purposes of their children. This is an unsecured loan and need not be for graduate or post-graduation courses but also for elementary and higher secondary courses.
4. Career growth education loans - These are loans provided to young people who want to pursue courses or trainings, certifications that will benefit their career growth.
Headquartered in Kumbakonam in Tamil Nadu, City Union Bank is Indian public-sector bank, offering a wide range of financial services to its customers. With the network of 557 branches and over 1530 ATMs, City Union Bank offers many loan products catering to the financial needs of individual customers to large industries.
Education is one area where everybody is willing to spend a lot of money to live a prosperous life in the future. Being one of the major education loan providers, City Union Bank (CUB) understands the needs of the students and offers extremely competitive education loans at better interest rates. Every year, many students secure admissions in top universities and colleges in India and abroad with City Union Bank (CUB) education loans.
Following are some of the advantages of applying for an educational loan with City Union Bank (CUB).
Objective: To provide term loan to Indian students for pursuing higher education in India and abroad where admission has been secured
Quantum of Loan:For studies in India, up to INR 10 Lakhs and for studies in abroad INR 20 Lakhs
Up to 4 Lakhs – Nil
bove Rs. 4.00 Lakhs - Studies in India - 5 % and Studies abroad – 15 %
Scholarship / Assistantship to be included in Margin.
Margin may be brought in on a year to year basis as and when disbursements are made on a pro-rata basis.
Up to Rs.4.00 Lakhs:
Parents / Guardian should join the execution of documents.
Security need not be insisted upon Above 4.00 Lakhs and up to Rs.7.50 Lakhs,
Above Rs.4.00 Lakhs and Up to Rs.7.50 Lakhs:
Co-obligation of parents / guardian together with collateral security in the form of suitable third-party guarantee. If we are satisfied about the net worth of the parents/means of parents /guardian, we may waive the condition of obtaining third party guarantee.
However, if the party offers security of immovable property and or guarantee from third party on a voluntary basis, it may be accepted for the loans up to Rs.7.50 Lakhs
Above Rs.7.50 Lakhs
The student/parents have the option to repay the interest during the holiday period.
If the student / parent does not opt for the same, the principal o/s together with interest
payable should be clubbed and should be repaid in EMIs.
The EMI amount should be fixed at the time of commencement of repayment
The loan to be repaid in 5 – 7 years after commencement.
Holiday Period: Course period + 1 year (or) 6 months after getting job whichever is earlier.
No processing fees / upfront charges may be collected for studies in India. For studies abroad, processing fee @ 0.20% should be collected
The bank can also issue the Capability Certificate for students going abroad for higher studies after obtaining the relevant supporting documents from the applicant.
Eligible Courses of Study in India
Graduation courses – B.Sc., B. A, B. Com etc.
Post-graduation courses- Masters & Ph.D.
Eligible Courses of Studies abroad:
CUB Vidhyavani (Management)
CUB Vidhyavani (Meritorious)
City Union Bank (CUB) education loan can be repaid in following three ways.
Standing Instruction (SI): If you are an existing account holder with City Union Bank (CUB), Standing Instruction is the best mode of repayment. Your EMI amount will be debited automatically at the end of the monthly cycle from the City Union Bank (CUB) account you specify.
Electronic Clearing Service (ECS): This mode can be used if you have a non-City Union Bank (CUB) account and would like your EMIs to be debited automatically at the end of the monthly cycle from this account.
Post-Dated Cheques (PDCs): You can submit post-dated EMI cheques from a non-City Union Bank (CUB) account at your nearest City Union Bank (CUB) Loan Centre. A fresh set of PDCs will have to be submitted in a timely manner. Please note Post Dated Cheques will be collected non-ECS locations only.
It is recommended that you opt for either the SI or ECS mode of payment for faster and less prone to error than the use of PDCs.
You can either apply online or visit a nearby City Union Bank (CUB) branch for the application. You can also download the education loan application form from the City Union Bank (CUB) official website, complete the form and submit it the bank representative.
You can also check your eligibility for an education loan through CreditMantri and apply for it.
1. What is the interest charged during moratorium period?
Only simple interest will be charged during the moratorium period. After the moratorium period the actual interest mentioned will be charged.
2. Can I take an education loan without a co-borrower?
No, a co-borrower is needed to take an education loan. The loan will be taken as a joint loan in collaboration with your parent/ guardian or spouse.
3. Is there a range on the rate of interest charged on Education Loan offered by City Union Bank (CUB)?
Yes, the interest rate ranges from 14.00 % - 16.00%. However, the it is subject to change at the sole discretion of the bank.
4. I am planning to study abroad. Am I eligible to apply for an Education Loan?
Yes, City Union Bank (CUB) offers up to INR 20 Lakhs for courses pursued abroad which also includes travel expenses and study tours.
5. Is there a processing fee for an education loan with City Union Bank (CUB)?
There are no processing fees for an education loan with City Union Bank (CUB)
6. Is there a way I can reduce the interest paid?
There is special subsidy provided according to Central Government subsidy for education loans. City Union Bank (CUB) also provides special interest rates for some premier institutions. The other option is your parent/ guardian or spouse can pay the loan amount during the moratorium period due to which the loan amount you need to repay is less.
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