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Educational Loans |
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Literacy
rate in India today stands at 53% of the population. While loans
education
is free till college for the girl child, the boy child has to pay for
college and even at schools. The public sector banks and the Cooperative
banks have been providing educational loans for higher studies for a number
of years now. Realizing the need of the hour is
for higher studies and the
large number of students opting for the same, even in high-grade
expensive institutes, the private sector banks have entered the foray. The Idea is a
tough one to sell in India, as people generally do not take up loans, let
alone loans education. However, things are now changing. With tax sops being
provided, courtesy of the finance minister and today's generation getting
more and more expense conscious, we see the youth are not willing to let
their parents pay for it. They work side by side and
earn and repay
their loans education . They are not willing to be a burden
on their parents. This has benefited in a few ways. The habit of earning
can be inculcated in today's youth. They can be made more independent and
responsible for their actions. Since educational loans form
a part of the priority sector lending, disbursements have also increased. The formalities
involved are also reduced and it is a lot easier and even cheaper today to
get a loans education for your child's bright
future. And the southward
movement of interest rates will only be icing on the cake. Government
of India in consultation with Reserve Bank of India (RBI)
and Indian Banker's Association (IBA) has framed a Comprehensive Educational Loan Scheme to
ensure that no deserving student in the Country is deprived
of higher
education for want of finances. The new scheme covers all type of
courses including professional courses in schools and colleges in India and abroad.
Salient features of the loans education Scheme
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The scheme envisages loans up to Rs.7.5 lakh for studies in India and up to Rs. 15 lakh for studies abroad.
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For loans up to Rs. 4 lakh no collateral or margin is required and the interest rate is not to exceed the Prime Lending Rates (PLR).
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For loans above Rs. 4 lakh the interest rate will not exceed PLR plus 1 percent.
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The loans are to be repaid over a period of 5 to 7 years with provision of grace period of one year after completion of studies. Tax Benefits Repayment of an loans education is deductible under section 80E of the Income Tax Act. The yearly limit for deduction is Rs. 40,000 (for both the principal and the interest). Only loans taken for higher education - fulltime studies in any graduate or post-graduate, professional, and pure and applied science courses - may claim deduction. The deduction will be available for a maximum of eight years starting from the day you start repaying. Equitable Access to quality higher education has been a concern of the University Grants Commission. To this purpose the Commission, besides encouraging colleges and universities to provide for liberal financial support to the meritorious but needy students, has also been instrumental in educational loan scheme. The Reserve Bank of India (RBI) has issued guidelines in this regard to all commercial banks. A large number of banks have already launched educational loan schemes.
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ELIGIBILITY CRITERIA |
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Studies
In India : |
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- School education including plus 2 stage
- Graduation Courses: B.A., B.Com., B.Sc., etc.
- Post Graduation Courses: Masters & Ph.D.
- Professional Courses: Engineering, Medical, Agriculture, Veterinary, Law,
Dental, Management, Computer, etc.
- Computer certificate courses of reputed institutes accredited to Department
of Electronics or institutes affiliated to university
- Courses
like ICWA, CA, CFA, etc.
- Courses conducted by IIM, IIT, IISc, XLRI, NIFT, etc.
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Courses offered in India by reputed foreign universities.
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Evening courses of approved institutes.
- Other courses leading to diploma / degree etc. conducted by colleges /
universities approved by UGC / Govt. / AICTE / AIBMS / ICMR etc.
- Courses offered by National Institutes and other reputed private institutions
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Studies Abroad : |
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Graduation: For job oriented professional / technical courses offered
by reputed universities.
- Post Graduation: MCA, MBA, MS, etc.
- Courses conducted by CIMA - London, CPA in USA etc.
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Educational/Study
Loan By : |
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