Education Loan for MBA: Know All About MBA Education Loan Options

Know all about MBA Education Loan options- As the time draws closer for offer letters from B-schools to arrive after GD/PI rounds are conducted and the results get announced, several MBA aspirants cringe and back out while investing their lifetime in B-schools because of their skyrocketing MBA fees. Read more about how to take education loan for MBA, tenure/ repayment duration, study loan for MBA interest rate, MBA education loan eligibility, What is the maximum loan for MBA and how much loan is required for an MBA.

Recommended: Top UGC approved colleges for Online MBA

Don't Miss: Best Online MBA courses by Top Universities

Related Article - Difference between PGDM and MBA

Educational Loan for MBA

For example, MBA admission in India could be anywhere between Rs. 5 to 20 Lakhs – an amount high enough to get students thinking and planning their finances. But money isn’t something that should stop anyone from getting into their dream B-school, and that’s why it’s time to turn that dream into a reality through an education loan for MBA.

Interestingly, Hari, whose father is a farmer and cannot afford a pricey MBA admission for his son, has found a solution to his distress. After getting calls from top B-schools, Hari was initially in two minds about going for MBA admission because he lacked the funds. Thanks to MBA education loans offered by banks and financial schemes of the government and other private sectors, bright students even from low-income families like Hari can achieve the desired independence and fund their education.

Today, loans for MBA admission are available with almost all major banks. Some banks even have tie-ups with some of the premier institutes. These banks offer the students a special rate of interest which is normally lower than the market rate of interest. You might feel a little apprehensive that MBA student loans are complicated monsters. But worry not. However, the candidates applying for the MBA educational loan must meet the MBA education loan eligibility criteria decided by the banks.

This article on Know All about MBA education loan in India Options by Careers360 will spell out all the basics of an MBA admission, the various MBA education loan options, top MBA loan providers and the steps to avail the study loan for MBA from various nationalised and private banks. During your ‘free time’ after you’re done with your MBA admission decision and are awaiting your offer letter anxiously, make use of this in-between time to research thoroughly about MBA education loan options.

Related Articles -

• How to prepare for GD-PI & WAT rounds of top B-schools
• Tips To Ace Personal Interview

Eligibility For Education Loan - MBA Admission

One can avail of a student loan for MBA admission if she/he is an Indian citizen and has documentary proof of having secured a confirmed admission to the course. It should be kept in mind that most lenders give a study loan for MBA to individuals in the 16-35 years age group.

To get a Study loan for MBA admission is a way easy if one gets admission to top management colleges like IIM (Indian Institute of Management), IIT (Indian Institute of Technology), FMS (Faculty of Management Studies) Delhi, XLRI Jamshedpur, SPJIMR Mumbai and few others. In such cases, some private banks and MBA education loan providers like Credila and Avanse might even call the students themselves.

The contact details of students are often shared by the institute with the banks and MBA student loan providers they collaborate with. This makes it easier as the bank may sometimes come to the customer’s doorstep to carry out the study loan processing formalities for MBA admission.

Expenses covered under Education Loan

Candidates have to encounter various expenses during MBA admission other than just the tuition fees. An MBA education loan in India covers 100 per cent of the basic course fee. Usually, the bank may also cover other related expenses while granting a study loan for MBA, like:

• Fee payable to college (tuition fee) and hostel (accommodation)
• Examination, Library, and Laboratory fee
• Books, types of equipment, instruments and other study material
• Caution deposit, building fund, refundable deposit supported by Institution bills or receipts.
• Travel expenses, passage money for studies abroad
• Purchase of Laptops, and computers-essential for completion of the course
• Any other expenses required to complete the course- like study tours, project work, thesis etc.
• Even the cost of a two-wheeler is covered as part of an MBA education loan by leading banks.

One of the MBA student loan schemes provided by the State Bank of India (SBI), called the SBI Global Ed-Vantage Loan Scheme, gives loans to students ranging from Rs. 20 lakhs to Rs. 1.5 crore with a 9.5 per cent to 10 percent interest rate. Under the SBI Global Ed-vantage Scheme, one may get 90 per cent coverage for expenses such as tuition fees, admission fees etc. and the remaining 10 per cent should be borne by them. Before going to approach a bank, students should know about the education loan for MBA interest rate.

MBA Admissions 2024-25 India: Top MBA Colleges in India Accepting national-Level Entrance Exam Score

Top 5 Simple Tips to Secure a Loan

• First of all one need to calculate their expected expenses
• Compare MBA education loans from different banks
• Search for the cheapest MBA education loan in India
• Pay interest during the course period
• Opt for the short repayment period
• Candidates can also use the education loan for mba calculator of different banks to know the eligibility, education loan for MBA interest rate and repayment period.

Documents required for Education Loan for MBA

• Loan application in bank's format
• Proof of admission to the course
• Passport size photos
• Address and age proof if you are not an existing bank customer
• Copies of mark sheets in the qualifying exams
• Schedule of expenses for the course (course prospectus where the course fee is mentioned)
• Statement of Bank account for the last six months of borrower/co-borrower
• Income tax assessment order not more than two years old (student’s or parents’)
• A brief statement of assets and liabilities of the borrower.

Also Read:

• IIM Fees for MBA - Check MBA Fee Structure for IIMs
• MBA Fees in India: Top Colleges, Fee Structure, Courses, Cost of MBA
• 5 Money Saving Tips For Your MBA
  

Top Banks offering Education Loan for MBA in India

Check out the below table to learn about the Private banks for MBA loans in India and their interest rate, and tenure. The table tells what is the maximum education loan offered for MBA in India.

Note: The names of the banks have been arranged in random order. The interest rate keeps changing. Candidates are suggested to check with the bank to know the exact interest rate before applying.

Tenure & Interest Rate of MBA Loan?

Repayment in EMIs within a maximum repayment period of 15 years (180 EMIs). EMI repayment starts 12 months after completion of studies or 6 months after getting a job, whichever is earlier.

People also search for -

• Which B-schools will you get based on your percentile?
• MBA Seats: Top B-schools in India and Number of Seats Offered by them
• MBA Admission Without Entrance Exam

IIM Sambalpur Bank Contact Details for Education Loan Purpose for MBA

MBA Education Loan financing and collateral requirement

On average, the MBA admission college fee and expenses in India are Rs. 12–18 lakh. It’s easy to get a loan of Rs. 10 lakh or less in India as it gets quickly and easily sanctioned. The option that gives a maximum loan at minimum fixed interest should be preferred. Normally for a Rs. 10 lakh loan, the borrower will end up paying around Rs. 16 lakhs at a 10 per cent interest rate. This means they will pay around Rs.17,000 every month for eight years after their post-graduation.

Banks can finance up to 100 percent of the loan depending on the amount of MBA admission Education Loan and the category of the institute. For most banks, there is no margin money required for an MBA education loan up to Rs. 4 lakh. For loans above Rs 4 lakhs up to Rs 7.5 lakh, a third-party guarantee is required. A collateral is asked for a loan exceeding Rs. 7.5 lakh.

However, the State Bank of India's Scholar Loan for students of certain premier business schools (except Indian School of Business, Hyderabad), as well as the Central Bank of India's IIM scheme, does not ask for any education loan for MBA without collateral security.

How to Get Education Loan for MBA

Today, technology has made it very simple to apply for an education loan from anywhere in the country. If a candidate’s bank allows online loan applications, then his loan is just a click away. Here is the procedure:

• The student has to complete an online education loan application form.
• The bank will follow up with the student and parents to answer questions.
• A representative of the bank will visit the student’s house and collect a signed application form with supporting documents.
• The student will provide a completed education loan application form with all the required supporting documents.
• A credit team from the bank will review and underwrite the education loan application.
• The bank will then approve the education loan or ask for any additional information required from the student’s end.
• Once the student’s signature is obtained on the education loan agreement, all the loan disbursement formalities are completed.
• The education loan amount is deposited in the required bank account electronically (student’s or institute’s, whichever is required).

Question: Can I get a Rs. 30 lakhs education loan?

Answer: Yes, if the applicants fulfil the eligibility criteria and submit a collateral security equal to the required MBA student loan will receive Rs. 30 lakhs as an MBA education loan from any of the banks in India.

Know more about

• Colleges accepting 60 percentile in CAT 2024
• Colleges accepting 70-80 percentile in CAT 2024
• Colleges accepting 90-100 percentile in CAT 2024

Repayment of MBA Education Loan

Repayment of loan for MBA Education starts one year after completion of the course or six months after securing a job, whichever is earlier. This relaxation period is termed as a moratorium. The repayment period is generally between five and seven years but can be extended beyond that as well, depending on the bank’s terms and conditions.

Benefits under the Income-tax Act - The borrowers of the education loan get an income tax benefit under Section 80(E) of the Income Tax Act of India.

Central Sector Interest Subsidy Scheme, 2009 on Model Education Loan Scheme (MELS) of IBA

Under this Scheme, an Interest Subsidy is given to support students from Economically Weaker Sections (EWS) whose annual parental income is up to Rs. 4.5 Lakhs from all sources. This subsidy is given during the moratorium period i.e., Course period plus one year on MBA Education loan taken from the Scheduled Banks under the Model Education Loan Scheme. This subsidy is allowed only once. The Nodal Bank is Canara Bank, Bengaluru. Some banks including the State Bank of Hyderabad and the Union Bank of India offer special rates of interest for girl students availing MBA educational loans.

Vidya Lakshmi Portal

Vidya Lakshmi Portal is an education Loan Portal handled by NSDL e-Governance Infrastructure Limited, Mumbai. Under this, any student can have access to education Loans. The Portal is linked with Scheduled Banks. Vidya Lakshmi Portal is a gateway to the Banks through which the student can proceed further with the education loan application and track it right from the inception stage of loan application to the sanction of the loan.

People also search for; Top B-schools in India Offering Affordable MBA