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Funding your MBA: Know all about MBA Education Loan options

Funding your MBA: Know all about MBA Education Loan options

Edited By Aditi Garg | Updated on Jul 01, 2024 03:28 PM IST | #MBA

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.

Funding your MBA: Know all about MBA Education Loan options
Funding your MBA: Know all about MBA Education Loan options

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.

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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:

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.

Bank Name

Max. Loan Amount (in Rs.)

Education loan for MBA interest rate

Repayment/Payback Tenure

MBA educational loan SBI

Upto 30 Lakhs for top IIMs and top-rung institutes

9.35%-10.70%


*Girls will have 0.50% concession

7 to 12 years

Oriental Bank of Commerce

Upto 25 Lakhs for Category A institutes, Upto 10 Lakhs for Category B institutes

10.25% to 10.75%


*Girls and SC/ST category students will have 0.50% concession


Upto 15 years

Allahabad Bank

Upto 20 Lakhs depending on the institute

For IIMs: 8%,

Others: 10%


7 years

Bank of Baroda

10Lakhs, upto 20Lakhs for premier institutes

10.5% to 11.5%

*Girls will have 0.50% concession

Added concession of 1.00% for students of premier schools (IIM, IIFT, XLRI etc.)

5 years

Canara Bank

Upto 20 Lakhs

10.65%

10 to 15 years

Axis Bank

Upto 10 Lakhs

15%

*Girls will have 0.50% concession

7 years

Punjab National Bank

Upto 20 Lakhs

8.15% to 8.75%

10 to 15 years

IDBI Bank

Upto 20 Lakhs

9.7%

10 to 15 years

Avanse DHFL

Upto 10 Lakhs

11.5%

10 years

UCO Bank

No ceiling

10.60%

10 to 15 years

ICICI Bank

Upto 10 Lakhs

As decided by bank upon amount usage.

*Girls will have 0.50% concession

5 to 7 years

HDFC Bank

Upto 10 Lakhs

14.50%

15 Years

Union Bank

20 Lakh

10.25%

15 Years

Bank of India

Upto 30 Lakh

9.95% to 10.45%

*Girls will have 0.50% concession

10 to 15 years

Central Bank of India

30 Lakh

9%

*Girls and SC/ST candidates will have 0.50% concession

15 years

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 -

IIM Sambalpur Bank Contact Details for Education Loan Purpose for MBA

S.NoBank NameContact PersonContact NumberEmail ID
1State Bank of IndiaChief Manager, SBI Branch Burla, Sambalpur8763451735,
9674719922
sbi.02034@sbi.co.in
2Union Bank of IndiaMr. Mukesh Kumar Dewangan, Ms. Nibedita Bal9981545454,
9861633487
pmo.sambalpur@unionbankofindia.com,
mukesh1.durg@gmail.com
burla@unionbankofindia.com
3Bank of BarodaMr. Gourab Haripal7328803810credit.sambalpur@bankofbaroda.co.in
4Punjab National BankMr. Pabitra Kumar Sahoo9692265577cosbpmtk@pnb.co.in
5Central Bank of IndiaMr. Suman Kumar Senapati, Soumendra Kumar Sahoo9778516622,
9439193473
creditsambro@centralbank.co.in
marketingsambro@centralbank.co.in
6Canara BankChief Manager, Sambalpur Branch7605009218,
7605009237
cb0185@canarabank.com
7HDFC BankMr. Debabrata Mishra7504963538debabrata.mishra@hdfcbank.com
8Axis BankMr. Bikash Khatuna9776910230bikash.khatua@axisbank.com
9ICICI BankMr. Prabhat Nanda, Ramesh Sahoo8328934338,
7328814845
-

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

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

Frequently Asked Question (FAQs)

1. Can I get 100% loan for MBA?Can I get a loan for an MBA?

Yes, eligible candidates will get a loan of up to 100 per cent as an education loan for mba.

2. Can I apply for an education loan before admission to an MBA programme?

Yes, most banks offer loan approval before your confirmed admission. This helps you show proof of funding for your admission.

3. When do I have to start paying my Equated Monthly Instalment (EMI) for MBA education loan?

EMI typically starts one year after completion of the course or six months after securing a job, whichever is earlier.

4. What kind of collaterals are accepted for MBA Education Loan? Can I get a Rs. 20 lakhs education loan without collateral?

Usually, for loans up to Rs. 7.5 lakh, you may not need to give collateral or security, but for loans above that, you will have to. A collateral need not only be a residential property. Lenders accept fixed deposits, insurance policies, National Savings Certificate and even Kisan Vikas Patra as collateral.

5. Are there any banks offering concessions for women applicants of MBA Education Loan?

Here’s a list of banks offering concessions on MBA Loans for female students across the country.

  • HSBC’s India Student Education Loan Program- Their education loans are “priced at a further discount of 50 BPS for female students in order to promote their education.” The bank offers this as an additional discount on its interest rates to female students.

  • Central Bank of India’s Cent Vidyarthi Program- For female students, they have lowered the base rate of interest for female students at 1.5 percent, as compared to two percent for male students.

  • Corporation Bank’s Corp Vidya Program- The bank offers concession in rate of interest at 50 BPS for girl students.

  • Overseas Bank’s Vidya Jyoti Program- They allows interest concession at 0.5 percent on all education loans to girl students for pursuing education in India and Abroad.

  • State Bank of India’s SBI Student Loan Scheme Program- Like other banks, SBI also has a lower rate of interest for girl students at 0.5 percent.

  • Allahabad Bank’s education loan- Rebate of one percent will be allowed under all the slabs for girl students.

6. My father is a farmer and does not have the funds to pay for my MBA education. Are there any government schemes for education loans that cater to bpl or low-income background?

The Government of India wants to ensure that nobody is denied professional education because he or she is poor. Indian Banks' Association (IBA) has formulated a comprehensive model educational loan scheme for adoption by all Banks.

7. How much is MBA student loan?

Rs. 20 lakh to Rs. 24 lakhs. Apart from this fee, you will have to meet other expenses for accommodation lodging and personal expenses during your MBA program.

8. What is the maximum loan for MBA?

Education loan up to 1 crore for study abroad and up to 50 lakh for an MBA in reputed institutes in India.

9. What is eligibility for education loan?

Any Indian citizen can apply for the loan. The minimum age of the loan applicant should be 18 years and maximum 35 years.

10. What is the interest rate for MBA student loan?

Private student loan interest rates range from 2 percent to 14 percent and are primarily based on your credit score.

11. What is the tenure of MBA loan?

The loan repayment period can go up to 15 years. Loan moratorium period is 6 months to 1 year from completion of course. Tax incentives up to 8 years on loan interest.

12. Is there any education loan for MBA without collateral security?

Yes, Candidates who wish to pursue an MBA programme with a course fee up to Rs. 7.5 lakhs can apply for an MBA educational loan without any collateral security. To apply for the educational loan for an MBA above Rs. 7.5 lakhs, the collateral security is required to apply for the loan.

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Questions related to MBA

Have a question related to MBA ?

Hello

Don't worry, you can try the following steps to recover your online MBA registration application ID:


1. Check your email: Look for emails from the university or admission portal, as they might have sent your application ID or login credentials.

2. Login recovery: Visit the admission portal and click on "Forgot Application ID" or "Forgot Password." Follow the instructions to recover your ID.

3. Contact support: Reach out to the university's admission support team or helpline, providing your name, email, and other details. They can help you retrieve your application ID.

4. Check your documents: Verify your application form, receipt, or acknowledgment letter, as they might contain your application ID.


If none of these steps work, you may need to re-register or contact the university's admission office for further assistance. Good luck!

Hi Ananya,

Yes, VIT (Vellore Institute of Technology) in Vellore, Tamil Nadu, offers MBA (Master of Business Administration) courses. VIT is well-known for its management programs and offers MBA in various specializations. The MBA program at VIT is highly regarded and attracts students from across the country.

Hope it helps!

Choosing between an MSc in Microbiology and preparing for CAT to pursue an MBA in Food Technology depends on your career goals and interests.


MSc in Microbiology:

  • Pros:
    • Deepen Your Knowledge: You will gain advanced knowledge and skills in microbiology, potentially leading to research or specialist roles in fields like medical microbiology, food microbiology, or industrial microbiology.

    • Specialized Careers: Opens doors to careers like microbiologist, research scientist, quality control specialist, or laboratory technician in various industries.

  • Cons:
    • Time Commitment: A master's degree requires additional time and financial investment.

    • Job Market: While the field is growing, the job market for microbiologists can be competitive.

MBA in Food Technology:

  • Pros:
    • Business and Management Skills: Gain valuable business and management skills applicable to the food industry. Learn about marketing, finance, operations, and innovation in the food sector.

    • Career Advancement: An MBA can open doors to managerial and leadership roles in the food and beverage industry.

  • Cons:

It is understandable that you are concerned about applying as EWS while being an open category student (Maratha) in the CET form for MBA 2023-24, considering the Maharashtra government's stance on EWS certificates for Maratha students.

The most reliable source of information in this situation is the admissions authority responsible for the MBA program you applied to. Look for their contact information (phone number or email address) on the official website of the institute or university conducting the MBA program.

  • Explain your situation clearly. Mention that you are an open category student (Maratha) but mistakenly applied as EWS in the CET form.

  • Inquire if this will cause any problems during admission processing, given the state government's policy.

    There is a chance they might allow you to rectify your application category from EWS to open (Maratha) before the admission process goes any further.

    The admissions authority might ask you to submit a letter explaining the error and your ineligibility for EWS due to the state government policy. They might have a specific format for this letter, so be sure to ask about it.

    It is important to address this issue proactively to avoid any delays in your admission process. The sooner you contact the admissions authority, the better.

    https://medicine.careers360.com/articles/ini-cet-exam-day-guidelines

    I hope it helps!

VIT Bhopal CSE Category 1 (2.01 Lakh):

  • Pros:
    • Reputed institution with a strong focus on engineering.
    • Category 1 ensures a good hostel and other facilities.
    • Strong alumni network and good placement record for CSE, with potential for high packages.
    • Focus on core CSE subjects.

  • Cons:
    • Newer campus compared to UPES.
    • Fees might be higher compared to UPES (check both institutions' fee structure).
    • Might not offer a combined program like NMIMS.

UPES Dehradun CSE:

  • Pros:
    • Established campus with good infrastructure and facilities.
    • Potentially lower fees compared to VIT Bhopal.
    • Might offer specializations or electives within CSE.

  • Cons:
    • Placement record might be slightly lower compared to VIT Bhopal for CSE (check placement reports of both institutions).
    • Reputation might not be as strong as VIT for pure engineering.

NMIMS Mumbai CSE MBA Tech:

  • Pros:
    • Located in Mumbai, a major commercial hub with ample job opportunities.
    • Offers a unique combination of technical and management education.
    • Good reputation for NMIMS School of Engineering.

  • Cons:
    • This program might be more expensive than the other two options (check fee structure).
    • Focus might be divided between technical and management subjects, potentially leading to less depth in CSE.

      https://www.careers360.com/university/upes-dehradun

      I hope it helps!
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