Best Education Loan in India

 In today’s world, education plays an important role in shaping the country’s future. Higher education plays an important role in creating a skilled workforce for the economy. However, with the rising cost of such education, it becomes difficult for a student to opt for higher studies. Therefore, to cater for this problem, banks and NBFCs offer “Education Loan” to them so that they can pursue their higher education without worry.

In today’s blog post, we will give you an overview of the best education loan, along with the documents required to apply for the same. 

 Meaning of Education Loan

An Education Loan, also known as a student loan, is generally taken out for students who wish to pursue higher education in India or another country. It covers all charges paid during the tenure of education, such as tuition fees, accommodation, travel, etc. Once the student completes his/her education and gets employed, he/she can start repaying the loans.

Features of an Education Loan

The salient features of education loans are as follows:

1. Lower Interest Rate: The interest rate on education loans is typically lower when compared to other loans such as personal loans.
2. Tax Deduction: One can claim the benefit of tax under section 80E of the Income Tax regarding the payment of interest on a loan.
3. Financial Help: Parents who cannot afford to give their child higher education can opt for monetary support in the form of an education loan.
4. Repayment Duration: The education loan can be repaid over time, so it does not significantly impact cash flow.

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Best Education Loan in India 2026 

The best education loans in India for 2026 are as follows: 

Bank	Loan Amount	Interest Rate (p.a.)	Collateral Required	Courses Covered	Key Features
SBI – Global Ed-Vantage	Up to ₹1.5 Cr	From 9.15%	Above ₹7.5 lakh	India & Abroad	No processing fee (India), girl student concession, long tenure
Bank of Baroda Scholar	Up to ₹1.5 Cr (abroad)	From 9.20%	Above ₹20 lakh	India & Abroad	100% expense coverage, interest subsidy
PNB – Udaan / Saraswati	Up to ₹1 Cr	From 9.25%	Above ₹7.5 lakh	India & Abroad	Multiple schemes, no margin up to ₹7.5 lakh
ICICI Bank iSMART	Up to ₹3 Cr	From 10.25%	Required above ₹50 lakhs	India & Abroad	Pre-visa disbursal, fast-track approval
HDFC Credila	No fixed upper limit (with collateral)	From 9.95%	Mandatory (profile-based)	India & Abroad	Custom loans, pre-visa disbursal, flexible repayment

Overview of Best Education Loan in India 2026

The overview of the best education loans in India 2026 is as follows:

1. SBI

SBI is India’s largest public sector bank in India. It offers Global Ed-Vantage as an education loan to the public through which one can cover the cost of domestic and mainly for overseas studies. It offers a low interest rate, with no processing fees for studies in India.

2. Bank of Baroda

This is a public sector bank offering “Baroda Scholar” which gives an education loan at no processing fees. It offers a competitive interest rate for higher education.

3. PNB

PNB is one of the oldest public sector banks in India, and offers “PNB Udaan”  to Indian students, allowing them to take a loan to complete their higher education. The loans are available for various courses such as graduation, post-graduation and professional courses.

4. ICICI Bank

This is one of the leading private sector banks. ICICI Bank offers online processing of education loans, with flexible duration for both domestic and international students. It also offers pre-visa disbursal of loan.

5. HDFC Bank

HDFC Bank is the largest private sector bank in India. It operates a dedicated education loan NBFC under its name, “HDFC Credila”. It offers a zero collateral loan facility to top students. 

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Eligibility Criteria for an Education Loan

The eligibility criteria for an education loan are as follows:

1. Nationality: The applicant for the education loan must be an Indian. However, in some cases, it can either be a non-resident individual or a person of Indian origin.
2. Age: The applicant’s age generally can vary from 16 to 40 years. But there are a few government schemes in which there is no age bar.
3. Co-Applicant: Generally, in case of a full-time course co-applicant or a joint holder is mandatory.
4. Collateral: There are certain asset such as residential and commercial properties, fixed deposits, etc., which needs to be kept with the loan companies.
5. Admission: The applicant must have a secured admission to a recognized institute or university in India or abroad. 

Expenses Covered Under Education Loans in India

The list of expenses covered under the education loans is as follows:

1. Tuition Fees: The tuition fees charged by the educational institute are covered under the educational loan.
2. Accommodation: The hostel fees or rent paid by the student for off-campus accommodation are covered under the educational loan.
3. Examination Fees: The fees payable to the college regarding the exam are covered under the educational loan.
4. Travelling: In case of foreign studies, the amount payable toward the cost of travel from a foreign country is covered under the education loan.
5. Project Work / Thesis Expenses: The cost related to completing the project is covered under the education loan.
6. Library and Lab Fees: Certain colleges levy fees to use the library and laboratory, which are covered under the education loan.
7. Other reasonable expenses: Some banks cover student life insurance, if opted. Other expenses like Fund Expenses, Stationery, equipment expenses are also borne by banks.

You can even use Education Loan EMI Calculator

Documents Required for Education Loan

The documents which are required to take an education loan are as follows:

1. An admission letter was received from the educational institute where one is looking to take admission.
2. Marksheets of previous classes. Generally, higher secondary and senior higher secondary marksheets are preferred. 
3. Address Proof
4. Identity Proof
5. Age Proof in case of a minor child.
6. Salary slip of the applicant or co-applicant to verify the income sources.
7. Bank statements to verify the salary.
8. Income tax returns of previous years, so that the income can be verified.
9. Loan Application form.
10. Visa and Passport if applied for foreign education.
11. Passport-size photos.
12. Additional documents for studying abroad.

Advantages of an Education Loan

The significant advantages of education loans are as follows:

1. Access to higher education: It enables a student to get higher education from various reputed colleges in India and abroad for under-graduation , post-graduation, vocational studies, skill development courses
2. Tax Benefit: The interest paid of education loans is eligible for tax deduction under section 80E of Income Tax upto 8 years.
3. Repayment: The repayment of loans can be started after 6-12 months once the course is completed or after getting a job, whichever is earlier. Loan tenure ranges from 5-15 years.
4. No Financial Burden: Taking an education loan generally does not create any financial burden on the family for the higher education of a child.

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Conclusion 

On a concluding note, opting for an education loan for higher education is a crucial step towards building your future. There are various banks and NBFCs offering such loans, but one should do a deep comparison before opting for an education loan. Taking education loans comes with a tax benefit on the amount of interest paid under section 80E of the Income Tax. However, it is advisable to consult your investment advisor before opting for an education loan.

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