How to apply for Education Loan?

How to apply for Education Loan?

Hi Students, Hope you have joined in your colleges for your higher education. Congratulations for your efforts and wishes to get good in your future endeavours. After joining in colleges, the first question is ” How to apply for an Education loan?”

Five years back, the scenario was entirely different. Bankers make the students and their parents to wander pillar to post for applying for Educational loan. The application process varied bank to bank. Even after a long struggle nobody assures that we can get the loan.

One of the most vital questions that you may wonder about is the amount of the educational loan. In general, you can get up to 4 lakhs of educational loan for higher studies without any collateral. Under education loan scheme, you can get a maximum of 15 lakhs for studies in India and more 25 lakhs for abroad studies.

Many banks asked collateral security for sanctioning education loans. And more particularly, the process was not transparent at all. The pupils, those who had recommendations and influence only got it sanctioned. More over, the interest rates were also wavering across the banks. So, getting an educational loan was a nightmare to the needy.

In this blog, we can look at the easiest way of getting an education loan without any ambiguity.

1. Education Loan – Vidya Lakshmi Portal

Vidya Lakshmi portal provides to students a single window electronic platform for Scholarships and Educational Loans.

Vidya Lakshmi is a first of its kind portal for students seeking Education Loan. This portal has been developed under the guidance of Department of Financial Services, (Ministry of Finance) , Department of Higher Education (Ministry of Education) and Indian Banks Association (IBA).The portal has been developed and being maintained by NSDL e-Governance Infrastructure Limited. Students can view, apply and track the education loan applications to banks anytime, anywhere by accessing the portal. The portal also provides linkages to National Scholarship Portal.

If you want to apply for education loan on Vidya Lakshmi portal, you must register on portal. Please provide essential details as mentioned in registration form.

Education Loan

2. Steps to apply for Education Loan

Education Loan

There are 3 Simple steps to apply for an education Loan.

1.Registration Process

2. Online Application filling

3. Apply to Banks.

This e-Platform provides an easy way of applying education loan to multiple banks. Previously, we need to apply every bank separately. This hectic procedure made frustration to students and their parents as well.

Registration is the basic process, which asks your details like Name, Mobile no., email ID and Password. After the confirmation of your mail ID and mobile no., the account will be activated within few minutes.

The applicant must register and login to Vidya Lakshmi portal and then fill-up the Common Education Loan Application Form (CELAF) by providing all the necessary details. After filling the form, the applicant can search for Educational Loan and APPLY as per his/her needs, eligibility and convenience.

Alternatively, the applicant can also search for Educational Loan after login and apply for the suitable Educational Loan by filling the CELAF.

The Common Educational Loan Application Form is the single form which students can fill to apply for Educational Loan to multiple banks / schemes. CELAF is the application form prescribed by Indian Banks Association (IBA) and accepted by all banks. This form is provided on Vidya Lakshmi portal to apply for Educational loan.

A student can apply to a maximum of three Banks through Vidya Lakshmi portal using CELAF.

3. Education loan Process

The Bank will update the status of the application on Vidya Lakshmi portal. Students can view the status of the application on the applicant’s dashboard on the portal. This is the transparent way for your regular updates.

The application status are 1. Application Approved 2.Application Hold 3.Application rejected

The Application hold status represents that the bank requires some further information or documents to be submitted by the student. The requirement will be indicated in the Remarks column and Student can check the same in the dashboard.

Rejected status represents that you may not be eligible as per the norms laid down by the selected banks. As of now 39 banks across India and 130 loan schemes are active. Depending on the schemes the loan interest varies.

4. Documents Required for Education Loan

In order to apply for an educational loan, you will have to prepare a number of documents beforehand.

The process goes as follows: Once you have determined to study at an institution and completed the process of admission, then you will have to concentrate on taking out an educational loan. Here are the documents which you should keep ready:

  • You will have to provide a proof of admission to the selected recognized institution.
  • Proof of your consistently high academic performance along with the last mark sheet will need to be produced.
  • The cut-off marks generally differ from general students to reserved students.
  • You need to produce a schedule of fees. Depending on the amount that you are applying for, you will need to produce income statement, statement of assets and liabilities etc.
  • If you are going to study abroad, you need to produce your passport with a valid visa also.
  • Your education loan will cover a number of things in addition to your tuition fees. These include hostel fees, exam fees, library fees, purchasing books, travel and other expenses for educational projects.
  • After all the documents have been submitted and verified, you will have to appear for an interview. It is best to know as much as possible about the course and the institutions that you have chosen.

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Dr. Soma Rajarajan

The author is a dynamic, passionate Teacher, Mentor, career consultant and Resource Person, for more than 27 years, committed in developing employable Engineers in their core domain. Interested in coping up with the technological changes happening around the world.

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