Indian Overseas Bank Education Loan
Indian Overseas Banks offer a variety of banking services to its customers, including educational loans with interest rates ranging from 9.75% p.a. to 13.00% p.a. , which provide financial aid to students who wish to apply for courses overseas.
The Indian international Bank was created in 1937 to promote international banking and foreign exchange operations. sAs of 2014, the bank had approximately 3700 domestic branches, including 1150 in Tamil Nadu, eight overseas branches and offices, and three extension counters. Banks offer a variety of banking services to its customers, including educational loans, which provide financial aid to students who wish to apply for courses overseas.
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Overview of Indian Overseas Bank (IOB) Education Loans
The following are the details regarding Indian Overseas Bank Education Loan:
Minimum Loan Amount | Up to Rs.7.50 lakhs (without collateral). |
Loan Amount | Up to Rs.7.5 lakhs without collateral. Above Rs.7.5 lakhs 100% collateral required. |
Maximum Loan Amount In India Foreign | Rs.15 lakhs Rs.30 lakhs. |
Interest Rate | 9.75% p.a. to 13.00% p.a. |
Interest Concessions | 0.50% for girl students 1% for interest serviced during the moratorium period 1.5% for institutions ranked up to 20 under NIRF 1% for institutions ranked 21 to 50 under NIRF. |
Interest During Holiday Period | Simple interest charged during the study period and up to the commencement of repayment. |
Margin Studies in India Studies Abroad | 5% (for amounts above Rs.4 lakhs). 15% (for amounts above Rs.4 lakhs). |
Moratorium Period | Course duration plus 1 year or 6 months after gaining employment, whichever is earlier. Interest servicing is optional for the borrower. |
Maximum Repayment Period | 15 years (excluding course and moratorium period), repaid in equated monthly instalments. |
Features and Benefits of the Indian Overseas Bank (IOB) Student Loan Scheme
The following is the list of significant features and benefits of Indian Overseas Bank education loan:
- Comprehensive coverage including tuition, hostel, examination fees, airfares, and books
- Wide range of eligible courses for graduation, post-graduation, diplomas, and professional courses
- No margin requirements for loans up to Rs. 4 lakhs; 5% for loans above Rs. 4 lakhs in India; 15% for abroad
- 1% rebate for timely interest payments and 0.5% concession for girl students
- Zero processing fees for education loans
- No hidden costs, ensuring transparent pricing
- Grace holiday period of 6 months after employment or 12 months post-course completion
- Flexible interest servicing options to pay interest during studies or add to principal
- Simple application process with minimal paperwork
Eligibility Criteria for IOB Education Loan
The following is the list of eligibility criteria for IOB education loan:
- Resident Indian students.
- NRI (Non-Resident Indian), OCI (Overseas Citizen of India), and PIO (Person of Indian Origin) students pursuing higher education, either domestically or internationally.
- Students must secure admission to a higher education course at a recognised institution in India or abroad.
- Admission should be through an entrance test or a merit-based selection process after completing Higher Secondary Certificate (HSC).
- Students admitted on management seats are eligible, provided that funding is restricted to the fee approved by the state government or a government-approved regulatory body for payment seats.
- The student should not be engaged in gainful employment during their studies.
- The creditworthiness of the student will be evaluated. If there are any adverse remarks in the credit history, the student will be required to submit an explanation.
Note: The student's ability to repay the loan will be assessed.
Eligible Courses for IOB Education Loan
Here is a table summarising the courses eligible for education loans for studies in India and abroad:
Category | Eligible Courses in India | Eligible Courses Outside India |
Degree Programs | Graduate/Post Graduate degrees and diplomas from recognised colleges/universities (UGC, AICTE, etc.) | Job-oriented professional/technical courses from reputed universities/institutions |
Institutions of National Importance | Courses from IIMs, IITs, IISC, XLRI, NIFT, NID, etc. |
|
Foreign Universities | Approved courses from reputed foreign universities conducted in India | Degree programs such as MCA, MBA, MS, etc. |
Vocational & Technical Courses | Regular degree courses like Aeronautical Engineering, Pilot Training, Shipping degrees, Diploma in Nursing | Degree/diploma courses like Aeronautical Engineering, Pilot Training, Shipping, etc. |
Professional Courses | Courses approved by regulatory bodies (e.g., DGCA, Indian Nursing Council) | Courses from recognised international bodies (e.g., CIMA in London, CPA in USA) |
Documents Required
The following is the list of relevant documents required to apply for IOB education loan:
Document Type | Details | Notes |
Applicant Documents | Past Academic Records: Mark sheets for Class X, XII, and undergraduate semester results. | Essential for verifying educational background. |
Competitive Exam Results: GRE, GMAT, TOEFL scores. | Required for eligibility in certain courses. | |
Photographs: Two recent passport-size photographs. | Must be current and clear. | |
Expenses Statement: Outline of expected educational expenses. | Helps in assessing loan amount needed. | |
Admission Letter: Proof of acceptance into a recognised institution. | Critical for loan application. | |
Loan Application Form: Completed and signed application form. | Must be filled out accurately. | |
Passport: Copy of a valid passport. | Required for identity verification. | |
Proof of Address: Water, gas, electricity bill, Aadhar, or driving license. | Essential for residency verification. | |
Proof of Identity: Driving license, PAN, Voter ID, or passport. | Necessary for identity confirmation. | |
Loan Account Statement: One-year statements for existing loans, if applicable. | Needed for assessing financial status. | |
Bank Account Statement: Recent statements for the student’s account, if applicable. | Important for financial verification. | |
Co-Applicant Documents | Photographs: Two passport-size photographs. | Same requirements as the applicant. |
Bank Account Statement: Last six months’ statements of the co-borrower. | Needed to assess financial stability. | |
Loan Account Statement: One-year statements if there is another ongoing loan. | To verify existing liabilities. | |
Proof of Identity: Similar to the applicant's requirements. | Necessary for verification. | |
Proof of Address: Same as required for the applicant. | Important for residency confirmation. | |
Salaried Co-Applicant | Form 16: Last two years’ copies. | Required for income verification. |
Salary Slips: Last three months’ salary slips. | Needed for assessing income stability. | |
Bank Account Statement: Last six months’ statements. | Important for financial verification. | |
Liability or Asset Statement: From parent, guardian, or co-borrower. | Necessary for evaluating financial status. | |
Self-Employed Co-Applicant | Income Tax Returns: Last two years’ returns if applicable. | Required for income verification. |
Business Address Proof: Documentation of business address. | Important for verification. | |
TDS Certificate: If applicable. | Needed for tax verification. | |
Bank Account Statement: Last six months’ statements. | Essential for financial verification. | |
Liability or Asset Statement: From parent, guardian, or co-borrower. | Necessary for financial assessment. | |
Qualification Statement: To verify educational qualifications. | Required for eligibility confirmation. |
Indian Overseas Bank Education Loan Interest Rates
Education Loans | Interest Rates |
Vidya Suraksha | 11.00% |
Vidya Jyoti | 11.00% |
Vidya Jyoti- Ward of Staff | 9.75% |
Skill Loan | 10.85% |
Vidya Shrest
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IOB Scholar
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Bihar Student Credit Card Scheme up to Rs.4 lakh Vocational Loans |
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IOB Career Dream
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How to Apply for Indian Overseas Bank (IOB) Education Loan
The following are the steps to apply for IOB education loan:
- Step 1: Go to your closest Indian Overseas Bank branch.
- Step 2: Ask the bank representative about different education loan options available. Discuss your eligibility and requirements to choose the most suitable loan product.
- Step 3: Once you have selected a loan product, begin the application process by submitting relevant documents such as identity proof, admission letters, and financial statements. For a more convenient application process, visit the VidyaLakshmi portal. This government platform allows you to apply for education loans from multiple banks.
- Step 5: Complete the online loan application form accurately, ensuring that all required fields are filled out.
- Step 6: Upload or physically submit all necessary documents as specified in the application form.
- Step 7: After reviewing your application, the bank will notify you of the approval status via SMS or email.
FAQs
Yes, Non-Resident Indians (NRIs) can apply for an education loan from Indian Overseas Bank to pursue higher studies, provided they meet the bank’s eligibility criteria.
If your desired course is not listed under IOB's education loan eligibility, it may still be possible to apply. Contact the bank for guidance on the specific course and its eligibility criteria.
Yes, IOB offers education loans for various vocational courses, including technical courses at recognised training institutes and polytechnics.
You cannot apply for an education loan with IOB without a co-borrower, as the bank requires a joint application typically involving a parent, guardian, or spouse.
You can apply for an education loan for studying abroad, but eligibility may depend on the institution’s recognition and your academic performance.
If you miss a payment, it’s important to contact IOB immediately to discuss your options, which may include restructuring the loan or setting up a payment plan.
Generally, repayment breaks are not allowed; however, if you are facing financial difficulties, you may contact IOB to explore options such as restructuring the loan.
If your family's income exceeds the subsidy threshold, you will not be eligible for interest subsidies under government schemes, but you can still avail of the standard loan terms.
Yes, Indian Overseas Bank typically allows early repayment of education loans without penalties, but it’s advisable to confirm this with the bank before proceeding.
If you wish to change your course, inform IOB as soon as possible to ensure that your loan remains valid and meets the eligibility criteria for the new course.
While it is possible to apply for multiple loans, it’s advisable to consult with IOB about the impact on your creditworthiness and repayment ability.
A poor credit score may affect your eligibility for an education loan; however, you can still apply, and the bank will assess your application based on other factors.
Yes, under Section 80E of the Income Tax Act, you can claim tax deductions on the interest paid on your education loan for higher studies.
If you need to extend your repayment period, contact IOB to discuss options for restructuring your loan to accommodate your financial situation.
Yes, you can include scholarships and assistantships as part of your loan application to demonstrate your financial standing and eligibility.
You can repay your IOB education loan EMIs via Electronic Clearing Service (ECS) for automatic deductions, Standing Instruction (SI) for existing IOB account holders, or by submitting post-dated cheques (PDCs) from a non-IOB account at the nearest Loan Centre.