What is an education loan subsidy?

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The rising cost of education has become a major obstacle, especially for meritorious students from economically weaker and minority sections. To ensure the availability and affordability of higher education, the Indian government launched education loan subsidy schemes for eligible applicants.

These schemes allow borrowers to avail an education loan in India with interest subsidy for the moratorium period. Here are a few of the education loan subsidy schemes available.
  • Padho Pardesh Scheme
    This program offers the opportunity of pursuing education abroad to students belonging to the minority community. Under the Padho Pardesh scheme, eligible individuals can avail 100% interest subsidy on their education loan
  • Central Scheme for Interest Subsidy
    This education loan interest subsidy program has been introduced for students from the economically weaker sections. Students can opt for this scheme to finance their studies in any professional or technical course.
  • Dr. Ambedkar Central Sector Scheme of Interest Subsidy
    This is also an interest subsidy scheme on education loans. Individuals from Backward classes (OBC) and Economically Backward Classes (EBC) can avail this financial assistance to study overseas.

Other solutions

Besides these schemes, another solution is the Bajaj Finserv Study Loan on Property. Its features include

  • Ample funding is up to Rs. 10.50 crore* , basis eligibility
  • Tenor ranging up to 15 years for easy repayment
  • A loan against property balance transfer facility to avail better loan terms on an existing loan
  • Exclusive Flexi facility to manage repayment more easily

Our loan against property is a smart way to access funding and pursue higher education on cost-effective terms.

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Frequently asked questions

Can I get a subsidy on an education loan?

Yes, in some cases, you can get a subsidy on an education loan in India. The Government of India offers certain education loan subsidy schemes to make higher education more affordable for students. One of the primary schemes is the ‘Interest Subsidy Scheme for Education Loans,’ which is aimed at helping students from economically weaker sections pursue higher education.

Who is eligible for an education loan interest subsidy?

Eligibility for an education loan interest subsidy in India depends on factors such as family income, the type of course and institution, the loan amount, and timely repayments. Various government schemes aim to assist economically weaker students pursuing higher education by subsidising the interest on their education loans.

How can I know my education loan subsidy?

To check your education loan subsidy status in India:

  1. Contact your lending institution
  2. Visit the NSDL's Vidya Lakshmi portal
  3. Check the relevant government department's website
  4. Contact the Ministry of Education
  5. Visit a local bank branch
  6. Review your loan account statements for subsidy details
Is subsidy available for the entire duration of the education?

Education loan subsidies in India are typically available during the ‘moratorium period’ and sometimes the ‘course period’. The moratorium period starts with the loan disbursement and extends through the course and a brief period after course completion. During this time, the government subsidises the loan's interest. The exact duration of these periods can vary based on the specific subsidy scheme and lender's policies.

Who is the income certificate issuing authority?

The issuing authority for an income certificate in India is typically the local government or municipal authorities. These certificates are often issued by the Revenue Department or the Tehsildar (a local administrative officer) in rural areas and by municipal officials or the Sub-Divisional Magistrate (SDM) in urban areas. The specific issuing authority can vary depending on the state and district within India.

How can a beneficiary claim the subsidy from the Government of India?

To claim a subsidy from the Government of India:

  1. Check your eligibility for the specific subsidy scheme
  2. Submit an application with the required documents to the relevant government department
  3. Once approved, follow the provided instructions for claiming the subsidy
  4. Subsidies are often directly deposited into your bank account
  5. Comply with any conditions or reporting requirements
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