India is home to the highest number of students in the world which is numbered at 315 million. According to the Sixth Report on All India Survey on Higher Education, 34.6 million of them are pursuing higher education. The Government of India, in its bid to push for education for all, has introduced several education loan schemes to ease the burden of especially the Economically Backward Sections (EWS) of the country.
Higher education, in particular, is often a costly affair. Top-tier colleges and universities in India and abroad generally charge a hefty fee from the students, making education unaffordable for the financially backward sections of the society. It is especially true for the private institutions who account for 277 out of the 799 accredited universities in the country.
Foreign universities are even costlier. Students going to European or American universities to pursue their undergraduate degrees may find it even more challenging to meet their financial obligations. A higher education loan can bridge the gap between such students and their choice of educational institutions. With the added incentives provided by the government, these loans can help secure your child’s future.
What Are The Government Schemes For Education Loan?
There are three major schemes that deal with education loan in India-
- Central Scheme of Interest Subsidy (CSIS).
- Padho Pardesh Scheme.
- Dr. Ambedkar Central Sector Scheme.
All three of these education loan schemes provide interest subsidy for education loans so that the burden of repayment doesn’t become too much for students and their parents. They have similar features but are meant for different sections of the Indian populace.
CSIS is meant for the Economically Backward Sections (EWS) who want to pursue professional or technical courses in Indian universities. Padho Pardesh Scheme caters to students of minority communities as declared by the National Commission of Minorities Act of 1992. This scheme is for pursuing advanced courses abroad. Dr. Ambedkar Central Sector Scheme provides interest subsidies to OBCs and EBCs who want to pursue higher education internationally.
Features Of Education Loan Schemes
As mentioned earlier, all these schemes are interest subsidy schemes applicable when you avail an education loan from financial institutions enrolled with the Indian Banks Association (IBA). There are some standard features of these schemes which are mentioned below.
- These schemes are applicable for students who want to pursue higher studies vis-à-vis Masters Degree, M.Phil. or Ph.D.
- The benefits of these initiatives can be availed only once. Someone who avails them for their Masters, for example, cannot do it again for their Ph.D.
- These schemes apply to the interest component of education loans which shall be borne by the government until the designated moratorium period. Moratorium period is defined as the duration of the course plus an additional year or six months after a student is employed, whichever is sooner.
- There is an income cap levied on the beneficiaries of these government initiatives, which is Rs. 4.5 Lakh for CSIS, Rs. 6 Lakh for Padho Pardesh and Rs. 2.5 Lakh for Dr. Ambedkar Central Sector Scheme.
- These education loan schemes shall stand null and void if the beneficiary leaves their studies midway or are expelled for their respective educational institutions on disciplinary grounds.
However, if you are looking for a higher loan quantum for pursuing costlier courses in India or abroad, you may explore the option of Loan against Property for Education from Bajaj Finserv. These loans allow you to avail up to Rs. 3.5 Crore to finance any of your educational pursuits. There are several other reasons why you should choose loan against property for education. These loans come with extended tenors of up to 20 years, along with attractive interest rates.
Must Read: Know About Different Education Loan schemes
Availing these loans is quick and easy too with Bajaj Finserv’s pre-approved offers. Such offers are available on numerous financial products including secured credits like home loans, unsecured credits like business loans and personal loans, etc. You can take a look at your pre-approved offer by providing your name and phone number.
The Constitution guarantees the Right to Education in India and these government initiatives and loans help financially challenged students to exercise that right at advanced educational levels.