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Oriental Bank of Commerce Education Loan

Oriental Bank of Commerce Education Loan


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Oriental Bank of Commerce Education Loan

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.

About Oriental Bank of Commerce

Oriental Bank of Commerce is one of the public-sector banks in India based in Lahore. The bank offers a wide range of banking products and services such as deposit accounts, loans, debit cards, credit cards (with tie up with Oriental Bank),Insurance products, ATMs, Internet banking, Mobile Banking, Self-banking halls, call centre, etc.

An Introduction to Oriental Bank of Commerce Education Loans

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, Oriental Bank of Commerce understands the needs of the students and offers extremely competitive education loans at better interest rates. Every year, a large number of students secure admissions in top universities and colleges in India and abroad with Oriental Bank of Commerce education loans.

Advantages of Oriental Bank of Commerce Education Loan

Following are some of the advantages of applying for an educational loan with Oriental Bank of Commerce.

  • Low interest rate
  • No hidden costs and administrative charges
  • Less paperwork
  • No processing fees
  • No security required for up to 4 Lakhs
  • 0.50% concession for girl students

Features of Oriental Bank of Commerce Student Loan Scheme

Objective: To provide financial support to meritorious students for pursuing higher studies in India & abroad with affordable terms & conditions.

Who is Eligible

Student who is / has: -

1. An Indian national.

2. Meritorious student

3. Secured admission to a higher education course in an institute recognized by a statutory body in India or abroad through entrance test/ merit based selection process after completion of HSC (10+2 or equivalent)


Entrance test or selection on merit may not be the criterion for admission in some of the post graduate courses or research programmes. In such cases, bank's (sanctioning authority) will have to adopt appropriate criteria based on employability (placement) and reputation of the institute concern.

Financing more than one member of the family

Loan to different meritorious students of same family can be allowed on merits subject to the compliance of other terms and conditions applicable to education loan policy. Each loan shall be considered separately.

Quantum of Loan:

Up to Rs. 10.00 Lakhs for studies in India

Up to Rs.20.00 Lakhs for studies abroad


Up to Rs.4.00 LakhsNIL
Above Rs.4.00 Lakhs5% For studies in India
15% For studies Abroad

Eligible Courses

Studies in India: 

  • Approved courses leading to Graduate/ Post Graduate degree and Post Graduate diplomas conducted by recognized Colleges / Universities approved / accredited by Government of India/ State Government/ UGC / Government /AICTE /AIBMS / ICMR or Regulatory bodies.
  • Courses like I.C.W.A., C.A., C.F.A., etc.
  • Courses conducted by IIMs, IITs, IISc, XLRI, NIFT, NID etc.
  • Approved courses offered in India by reputed foreign universities
  • Evening courses of approved / accredited institutes
  • Computer Certificate courses of reputed institutes accredited to the Department of Electronics or Institutes affiliated to Universities.
  • Regular Degree/ diploma courses like Aeronautical, Pilot training, Shipping etc. approved by Director General Of civil Aviation/ shipping, if the course is pursued in India
  • Nursing Courses conducted by institutes approved by State / Central Government/ Regulatory body.

Studies Abroad:

1. Graduation

 For job-oriented professional/technical courses offered by reputed universities.

2. Post Graduation

 Courses like MCA, MBA, MS etc.

3. Courses conducted by CIMA-London, CPA in USA etc.

4. Degree/ Diploma

 Courses like Aeronautical, Pilot training, and Shipping etc. provided these are recognized by competent regulatory bodies in India/ abroad for the purpose of employment in India and abroad.

Two / Dual Courses

Education loan for Diploma and degree courses simultaneously may also be considered for two / dual courses provided by the educational institutions.

Expenses Covered

1. Fee payable to college/ school/ hostel (lodging and boarding). Reasonable Lodging & Boarding charges will be considered in case the student chooses/ is required to opt for outside accommodation.

2. Examination/ Library/ Laboratory fee.

3. Insurance premium for student borrower, if applicable.

4. Caution deposit, Building fund/ refundable deposit supported by Institution bills/ receipts, subject to the condition that the amount does not exceed 10% of the total tuition fees for the entire course.

5. Travel expenses/ passage money for studies abroad.

6. Purchase of computers-essential for completion of the course*.

7. Purchase of books/ equipment/ instruments/ uniforms*.

8. Any other expenses required to complete the course-like study tours, project work, thesis, etc.

Penal Interest

2% over the normal rate of interest shall be charged on loan above 4 Lakhs on overdue amount for the overdue period.

Process Fee

For study in India: NIL irrespective of loan limit.

For study abroad: Rs.1000/- +Service tax, if any. However, the fee would be refunded to the student on taking up the course (excluding service tax if paid to Government).

Prepayment Penalty: NIL


Loan upto Rs.4.00 Lakhs

1. No security.

2. Parents / guardian to be joint borrower (s) (irrespective of their means and age of student).

3. Co-obligation of spouse/ parents-in-law in case of married women.

4. In case of commercial pilot course obtaining of Life Insurance Cover shall be obtained.

Loan above Rs.4.00 Lakhs & upto Rs.7.50 Lakhs

  • Parents / guardian to be joint borrower (s) (irrespective of their means and age of student).
  • Co-obligation of spouse/ parents-in-law in case of married women.
  • Collateral security in the form of one suitable third party guarantee, preferably of other family member / close relative. In case of commercial pilot course Life Insurance policy shall be obtained.

Loan above Rs.7.50 Lakhs

1. Parents / guardian to be joint borrower (s) (irrespective of their means and age of student).

2. Co-obligation of spouse/ parents-in-law in case of married women.

3. Mortgage of immovable property or any other tangible security like pledge of NSCs/UTI/LIC (Surrender Value)/ PSU Bonds etc. having value equivalent to 100% of loan amount.


Extension of charge or 2nd charge on unencumbered portion of land and building already mortgaged with Bank or other Banks/PSUs/FIs be accepted provided the residual value of unencumbered portion is at least equivalent to amount of proposed education loan if the conduct of the existing account is satisfactory and falls under standard/regular category.

Assignment of future income of the student on getting employment after completion of the course for payment of installment. An appropriate affidavit to this effect be obtained from all joint borrowers.


Bank may arrange for Life Insurance policy for the students availing education loan. While obtaining such insurance cover, the prior consent of student / co-borrower shall be obtained and kept on record.

The insurance premium has to be borne by the student / co-borrower. However, sanctioning authority may consider the premium amount as one of the component of finance, if requested by student / co-borrower.


For loan upto Rs.7.50 Lakhs - Upto 10 years

For Loan above Rs.7.50 Lakhs - Upto 15 years

Moratorium Period/ repayment holiday (course period + Grace period)

(The moratorium period be permitted within the overall repayment period of respective loan)


For studies in India:

Loan shall be disbursed in stages as per requirement / demand, directly to the institutions/vendors of books/ equipment/ instruments etc. to the extent possible.

For studies abroad:

In stages as per requirement/demand, directly to the institutions subject to obtention of certified copies of relevant pages of passport and visa of the student.

For students & working Professionals

Up to Rs.4.00 LakhsBR + 2.50% = 12.20%
Above Rs.4.00 Lakhs & Upto Rs.7.50 LakhsBR + 3.00% = 12.70% (or) BR + 1.75% = 11.45%
Above Rs.7.50 LakhsBR + 1.75% = 11.45%

Scheme for Vocational Education & Training: BR + 2.50% = 12.20%

For Category A institutions: BR = 9.70%

For Category B institutions: BR + 0.50% = 10.20%

Documents Required

  • Letter of admission
  • Filled in Loan Application Form
  • 2 passport size photographs
  • Statement of cost of study
  • PAN Card of the student and Parent/ Guardian
  • AADHAR Card of the student and Parent/ Guardian
  • Proof of identity (Driving Licence/Passport/Aadhar/ any photo identity)
  • Proof of residence (Driving Licence/Passport/Electricity bill/Telephone bill)
  • Student/Co-borrower/ guarantor's bank account statement for last 6 months
  • IT return/ IT assessment order, of previous 2 years of Parent/ Guardian/ other co-borrower (if IT Payee)
  • Brief statement of assets & liabilities of Parent/ Guardian/ other co-borrower
  • Proof of income (i.e. salary slips/ Form 16) Parent/ Guardian/ other co-borrower

EMI Payment Methods

Oriental Bank of Commerce education loan can be repaid in following three ways.

Standing Instruction (SI): If you are an existing account holder with Oriental Bank of Commerce, Standing Instruction is the best mode of repayment. Your EMI amount will be debited automatically at the end of the monthly cycle from the Oriental Bank of Commerce account you specify.

Electronic Clearing Service (ECS): This mode can be used if you have a non-Oriental Bank of Commerce 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-Oriental Bank of Commerce account at your nearest Oriental Bank of Commerce 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.

How to Apply for Oriental Bank of Commerce Education Loan?

You can either apply online or visit a nearby Oriental Bank of Commerce branch for the application. You can also download the education loan application form from the Oriental Bank of Commerce 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.

Oriental Bank of Commerce Education loan FAQ

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 Oriental Bank of Commerce?

Yes, the interest rate ranges from 9.70 % - 12.70%. However, 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, Oriental Bank of Commerce 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 Oriental Bank of Commerce?

There are no processing fees for an education loan with Oriental Bank of Commerce except in the case of loans taken to study abroad. Which is Rs.1000

6. Is there a way I can reduce the interest paid?

There is special subsidy provided according to Central Government subsidy for education loans. Oriental Bank of Commerce 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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