Further details of Central Bank’s Education loan schemes mentioned in above table

1. Cent Vidyarthi

The term loan can be availed by Indian national students wanting to pursue higher education in India or abroad and have secured admission for the same by way of merit –entrance test scores or HSC examination marks whichever was applicable for the institute / university applied.

The courses would include graduation degree / post-graduation degree/ professional/ technical/ Diploma/ Engineering/ MBBS/ MBA/ MCA/ MS/ offered by colleges / universities/ institutes of reputation and recognized by academic regulatory bodies in India and abroad.

The maximum quantum of loan amount for studies in India is ₹10 lacs and ₹20 lacs for studies in abroad. However, in case the student requires any loan amount beyond these specified limits, it will have to be backed up by 100% collateral security.

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.

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

The moratorium period covers the entire course period and an additional 12 months. The repayment period commences post the completion of moratorium period or 6 months of landing a job, whichever is earlier. The repayment period varies in accordance to the loan amount. For loans up to ₹7.50 lacs, the repayment period is up to 10 years. For loans above 47.50 lacs, the repayment period is up to the maximum of 15 years.

The disbursement of loan instalments is directly made to the college / institute / university. However, in case appropriate proofs are made available, the bank disburses the payments to borrower directly and original receipts are required to be submitted to the bank.

No collateral security is required for amount of up to ₹4 lacs, while parents/guardian will be required to sign up as co-borrower. For any loan amount between ₹4 lacs and ₹7.5 lacs, third-party guarantee and parent as joint borrower would be required. For any amount above ₹7.5 lacs, tangible security is mandatory. Such tangible security must be in equivalent value of the loan amount and must be acceptable to the bank as per their guidelines.

Insurance – This loan facility will have to be mandatorily covered with a life insurance policy and sum assured being equal to the loan amount for the duration of the loan scheme. The premium payments will have to be serviced by the borrower. In the event the loan could not be repaid, the bank will stake claim to the insurance cover.

Below describes the rate of interest facility under this loan scheme: (Repo Rate – 4.00%)

Interest payments – During the course and moratorium period, the interest payment is calculated on simple basis. Once the repayment period kicks in, the interest is compounded monthly. In case the interest payments are serviced during the course and moratorium period, the applicant can avail a 1% interest concession.

Processing fees – Loan for studies in India is exempted from processing fee / charges. However, for studies abroad, the bank would levy a charge of ₹500 for loans up to ₹10 lacs and ₹1000/- for loan amount beyond ₹10 lacs.

2. Cent Vidyarthi Executive MBA

This loan scheme is available to students wanting to pursue Executive MBA programme and have secured admission for the same, from any reputed institute of India or abroad.

In order to avail of this loan, the applicant must have a work experience of at least 2 years in any organization – public or private and must have completed minimum age of 23 years.

The quantum of loan is capped at a maximum of ₹20 lacs against which no collateral security is necessary. Any amount beyond the specified figure will have to be backed up by 100% liquid collateral security equivalent to the loan amount.

No margin is applicable under this scheme, i.e., the whole course is 100% funded by the bank.

The moratorium period under this scheme is the duration of the course and an additional 3 months post which repayment period will be initiated. For loan amount up to ₹7.50 lacs, the repayment period is of 8 years. For any amount above ₹7.50 lacs, the repayment period is of 12 years.

Under this loan facility the institutes in India are graded as Schedule A, Schedule B, Schedule C which is in accordance with their reputation and rankings.

Institutes under Schedule A:

Institutes under Schedule B:

Institutes under Schedule C:

Insurance – This loan facility will have to be mandatorily covered with a life insurance policy and sum assured being equal to the loan amount for the duration of the loan scheme. The premium payments will have to be serviced by the borrower. In the event the loan could not be repaid, the bank will stake claim to the insurance cover.

Co-borrowers – The co-borrower condition is mandatory and applicable for students who have secured admission in the institutes as mentioned under Schedule C and is optional for students having secured admission to any institute under Schedule B. Students of Schedule A are exempted from the same. Co-borrowers must be a parent(s) or guardian of the applicant / student. In case the student is married, his / her spouse can be mentioned as co-borrower.

Below describes the rate of interest facility under this loan scheme:

Processing fee – No processing charges are applicable under this facility.

3. CENT VIDYARTHI-IIMs & other Institutes

This loan is applicable to Indian national students wanting to pursue full time higher education courses such as MBA / PGDM / PGPM from institutes of excellence and repute, in India.

The quantum of loan amount is capped at a maximum of ₹40 lacs with no collateral security, nor third party guarantee being required. While the loan will be sanctioned in the name of the student / applicant, the parent(s) / guardian / spouse need to sign up as co-borrowers / joint borrowers.

No margin is applicable under this facility i.e., the entire course is 100% funded by the bank.

Insurance – This loan facility will have to be mandatorily covered with a life insurance policy and sum assured being equal to the loan amount for the duration of the loan scheme. The premium payments will have to be serviced by the borrower. In the event the loan could not be repaid, the bank will stake claim to the insurance cover.

Rate of Interest

Repo rate (4.00%) + 3.00%

List of IIMs:

List of other reputed institutes:

4. Cent Skill Loan (Vocational Education and Training)

This facility is for the applicants who have been registered for programmes offered by Industrial Training Institutes (ITIs) or any centres for training of various skill development programmes or any training institutional partners affiliated to NSDC or State Skill Corporation, leading to degree / diploma / certificate as prescribed by the National Skill Qualification Framework.

The minimum and maximum loan facility under this scheme is ₹5,000/- and ₹1,50,000/- respectively wherein –

• the loan amount for courses going up to 6 months – ₹50,000/-
• the loan amount for courses exceeding 6 months – ₹1,50,000/- (maximum)

There is no requirement of collateral or third-party guarantee, however, the applicant’s parent will have to sign up as joint borrower.

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

• Any course that is up to 1 year – moratorium period of 6 months from the completion of course is applicable.
• Courses more than 1 year – the moratorium period of 12 months from course completion.

Repayment period is initiated after the completion of moratorium period.

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

Below describes the rate of interest facility under this loan scheme:

Documents Required for the above loan schemes

Following documents will be required for application of the loan schemes mentioned above:

• 10^th, 12^th and Graduation (if applicable) marksheets, entrance exam score proof
• Copy of admission proof provided by the institute / university (Provisional copy accepted at early stage, but will have to submit the copy of actual admission offer letter once received)
• Schedule of fee / expense structure for the entire course period
• Scholarship certificates copies (if any)
• Gap certificate (if any – self declaration by applicant regarding gap in studies)
• Passport size photographs of applicant (student), co-borrower (parent), third party guarantor (if any)
• Co-applicant / guarantor’s statement of assets and liabilities (for any loan amount above ₹7.50 lacs)
• In case of salaried persons –

1. Latest salary slips
2. Copy of Form 16 / recently filed Income Tax Return

• In case of non-salaried persons –

1. Address proof of business incorporated (if applicable)
2. Copies of latest Income Tax Returns

• Bank account statements for past 6 months of Co-borrower/ guarantor
• Documents indicating ownership of collateral and tangible security
• PAN Card Copies as identity proofs of applicant, Co-borrower, Guarantor (mandatorily self-attested)
• Aadhar (UID) Card copies of student, co-borrower (parent), guarantor as address proofs (mandatorily self-attested)
• Passport Copy (compulsory for any loan towards foreign studies) (mandatorily self-attested)
• Copy of Driving License (if available – mandatorily self-attested)
• Copy of Voter’s ID card issued by Election Commission of India (mandatorily self-attested)
• Job card issued by NREGA and signed by gazetted officer of GoI (in the case of Skill Loan Scheme)

How to Apply for the loan

Online process – The above-mentioned Central Bank Education loan schemes 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 Central Bank of India and file for application of loan by filling out the required forms and submitting the copies of mandatory documents.

Note – At the time of enquiring about the various loan facilities, kindly confirm with the bank officials regarding the opening of savings bank account for loan disbursement.

Insurance –

The Central Bank of India has resorted to apply insurance cover over its education loan schemes (except for skill loan scheme) owing to the fact that few of these schemes have a high quantum of loan amount with no collateral security being made mandatory. In such cases, the banks cannot just depend on the reputation of the institutes, but will also need to foresee many other factors such as –

• 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.