Allahabad Bank Education Loan

Founded in 1865, the Allahabad bank has reached a juncture, where it is one of the leading nationalized financial institutions providing social-welfare based services, such as education loans, micro-finance and agriculture loans. The education loans, catered to students of India origin, are available with the following features…

Interest Rates

The base rate of the bank is 10%, and Benchmark Prime Lending Rate (BPLR) is 14.25%. The interest rate for education loans of Allahabad bank is base rate + 3 per cent, i.e., 13%.

Charges

Flexibility

• Eligibility

Courses in India for which loan is available:

1. Graduation courses: B.A, B.Com, B.Sc., etc.
2. Post-Graduation Courses: Masters Courses, PhD, etc.
3. Professional Courses: Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Computer, etc.
4. Computer Certificate Courses of reputed Institutes, accredited to Department of Electronics or Institutes affiliated to University.
5. Courses like ICWA, CA, CFA, etc.
6. Courses conducted by IIM, IIT, IISC, XLRI, NIFT, etc.
7. Regular Degree/ Diploma courses like Aeronautical, pilot training, shipping, etc., which are approved by Director General of Civil Aviation/ Shipping. If the course pursued abroad, the Institute should be recognized by the competent local aviation/ shipping authority.
8. Courses offered in India by reputed foreign universities.
9. Diploma courses, offered by recognized institutes.

Courses abroad for which loan is available:

1. Graduate courses for job-oriented professional and technical courses offered by reputed universities.
2. Post-Graduation courses and courses conducted by CIMA London, CPA in USA, etc.
3. Regular Degree/ Diploma courses like Aeronautical, pilot training, shipping, etc. The institute should be recognized by the competent local aviation/ shipping authority.

• Loan Amount: The amount of loan depends on the repaying capacity of the parents and student. However the upper limit is Rs 10 lakh for studying in India, and Rs 20 lakh for studying abroad.

• Expenses covered under Allahabad Bank’s educational loan are mentioned below:

1. Fee payable to college/ school/ hostel
2. Fees for examination/ library/ laboratory
3. Purchase of Books/ Equipment/ Instruments/ Uniforms.
4. Caution deposit/ Building Fund/ Refundable deposit supported by bills/ Receipts of the institution, subjected to the conditions that amount do not exceed 10 per cent of the total tuition fees for entire course.
5. Travel expenses/ passage money for studies abroad.
6. Purchase of computers essential for completion of course.
7. Insurance premium for student.
8. Other expenses required to complete the course, for example, study tours, project work, thesis, etc.

• Repayment options

1. Repayment Holiday / Moratorium: Course Period + 1 year or 6 months after getting job, whichever is earlier.
2. The maximum repayment period of 7 years can be considered by the Bank.

• Margin is the percentage of study cost that borrower has to pay. There is no margin applicable for loan amount up to Rs 4 lakh; whereas for loans worth above Rs 4 lakh, 5 per cent of the study cost has to be paid by borrower for studying in India, and 15 per cent for studying abroad. Scholarship/ assistantship, if any, may be included in the margin amount. Margin money to be brought on year-to-year basis.

• Time taken for processing: According to the official website of the bank, it takes 7 to 10 days to process education loan.

• Freebies

1. Free debit card
2. Group life insurance cover

Example

Loan amount: Rs 3.5 lakh

Interest rate: 13%

Tenure: 36 months (3 years)

EMI calculated: Rs 11,793

You end up paying: Rs 4,24,544

Other Details

• Pre-Sales Information: The website contains satisfactory information about the terms and conditions applicable to education loan, but does not contain a detailed overview of the charges as well as the documents required.
• Customer Support: The Bank does not do very good on the customer care front. Customer support system is not in place, other than the phone number and email ID of General Manager (Planning and Development). No toll free number for grievance redressal has been provided.

Documents Required

The documents required have not been disclosed on the website. But generally the following documents are required by banks pre-sanction:

1. Mark sheets of the qualifying examinations
2. Proof of admission to the course
3. Schedule of expenses for the course
4. Copies of letters confirming scholarship, etc.
5. Copies of foreign exchange permits, if applicable
6. Passport-size photographs.
7. Statement of the borrower's bank account for past six months
8. Income-tax assessment order, not more than two years old
9. Brief statement of the borrower's assets and liabilities
10. If you are not an existing bank customer, you will also need to give proof of identity and residence.

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