Further details under each scheme mentioned in above table

1. Education loan scheme

The loan can be availed by Indian national students wanting to pursue higher education in India or in abroad. The facility is provided to students who have secured admission by way of entrance tests or HSC marks or by merit based selection.

The quantum of loan amount for studies in India is ₹10 lacs and for abroad is ₹20 lacs.

For any loan amount up to ₹4 lacs, no collateral security is requested and parents are required to sign up as co-borrowers. For the loan amount between ₹4 lacs and below ₹7.50 lacs, parents as co-borrowers and a third-party guarantee is required and no security is necessitated. For a loan amount that is above ₹7.50 lacs, will require collateral and tangible security that is equivalent to amount availed.

No margin is applicable for any loan amount of up to ₹4 lacs and an amount above ₹4 lacs will attract a margin of 5% for studies in India and 15% for studies in abroad.

Repayment period – for any loan amount availed up to ₹7.50 lacs, the repayment period is up to 10 years excluding the moratorium period which covers the entire course duration with an additional 1 year. For loan amount that is above ₹7.50 lacs, the repayment period is up to 15 years excluding the moratorium period.

Almost all expenses of the course (including study tours, hostels, library, equipment, books, project work etc.) are covered under the scheme.

Rate of Interest – Simple interest rate is applied during the moratorium period and later, it is compounded monthly. Concessions of up to 1% on interest rates are available only during the moratorium period.

Documents required for the Education loan scheme (BoM) can be viewed here Checklist for Education Loans

***No Insurance cover facility is applicable under this education loan scheme provided Bank of Maharashtra.

1.a.) Central Scheme – Interest rate subsidy for students of EWS:

The Government of India had introduced the full interest rate subsidy for the duration of moratorium, on education loan availed by students of economically weaker sections, who are willing to pursue graduation or post-graduation courses, technical courses, diplomas or degrees, professional courses, offered by recognized and renowned institutions in India.

Applicability: The central scheme is applicable only for students wanting to pursue higher education courses in India. The subsidy is provided only for students who have secured admission to the institutions that are established by the Acts of Parliament; institutions / universities that are recognized by statutory bodies; and the Central / State Universities.

Eligibility for the subsidy: The scheme is available only once i.e., the loan must be availed for either graduation or PG and in order to be eligible, the students must have secured admission to the institutions on the basis of merit. The subsidy will however, be revoked, in case the student is dismissed from the institution on academic or disciplinary grounds or has discontinued from the course out of will. But if the discontinuation is due to medical / health reasons, the subsidy shall stand, provided the evidence of such reason is submitted to the institution authorities.

Period of Subsidy: The subsidy shall be applicable for the period of moratorium of the education loan scheme of the bank, wherein the duration includes the entire course period and an additional 1 year or six months after landing a job, whichever is earlier. Post the completion of the moratorium period, the original interest rate as prescribed by the bank shall be applicable.

Income Limit: As the subsidy scheme is applicable only to the economically weaker section students, the maximum income earned from all sources by the family of applicant must not exceed ₹4 lacs p.a.

Income Proof for subsidy: As the scheme is applicable to the EWS category students, valid income proofs such as income certificate issued by the public authorities authorized by Central or State governments, is mandatory for initiating interest subsidy.

2. Skill Loan Scheme

To avail the loan scheme, the applicant must have enrolled into courses offered by Industrial Training Institutes (ITIs) or any polytechnic institutes or any recognized centres for training of skill development or any training partners affiliated to NSDC or State Skill Corporation, which leads to issuance of degree / diploma / certificate as prescribed by the National Skill Qualification Framework.

The minimum and maximum quantum of loan that can be borrowed under this scheme is ₹5,000/- and ₹1,50,000/- respectively wherein for any course that is for a duration of up to 6 months, the loan amount is ₹50,000/- and for courses exceeding 6 months duration, the amount is up to ₹1,50,000/-

Although no collateral or third-party guarantee is required, the applicant’s parent will be required as joint borrower

Moratorium period under this scheme depends on the duration of the course.

• For any course that is up to 1 year – moratorium period will be for 6 months from the completion of course.
• For courses that are more than 1 year – the moratorium period will be applicable for 12 months from course completion.

Repayment period will be initiated after the completion of moratorium period.

• Loan up to ₹50,000 – 3 years
• ₹50,000 to ₹1 lac – 5 years
• More than ₹1 lac – 7 years

How to Apply for the loan

Online process – The above-mentioned BoM Education loan scheme can be applied via online from Vidya Lakshmi Portal, which is a centralized portal specifically catering to students wanting to explore multiple options offered by various banks before choosing the appropriate loan scheme which is in tandem to the applicants’ needs.

Offline process – The applicant will have to visit the nearest branch of BoM and file for application of loan by filling out the required forms and submitting the copies of mandatory documents.

In case the applicant does not own any savings account with BoM, he/she will first have to open a savings account before availing the loan facility.

***Insurance: Bank of Maharashtra has not yet come up with insurance cover for its education loan scheme, however many banks are now resorting to include insurance on the same. This subsequently raises the interest rates on these loans.

Few major reasons for inclusion of insurance cover are –

• Covering of default risk rising due to poor job markets
• Exchange rate risks in the case of overseas education loans
• Below satisfactory campus placement records
• Possibility of discontinuation of course by student or debarring by institutions on disciplinary or academic grounds.