The “Education Loan” scheme, initiated by the National Backward Classes Finance And Development Corporation under the Ministry of Social Justice & Empowerment, aims to provide financial support to students from Backward Classes pursuing professional/technical education at graduate and higher levels, along with vocational courses.
Courses Covered
The scheme encompasses all professional and technical courses approved by the appropriate authority, both at the graduate and higher levels, as well as vocational courses.
Moratorium Period
A uniform moratorium period of five years is set for recoveries from Channel Partners, regardless of the course’s type and duration.
Repayment
After the five-year moratorium period, the maximum recovery period extends to 10 years. Thus, the loan must be repaid within 15 years of disbursement.
Pre-payment of Loan
Borrowers have the flexibility to repay the loan at any time after the repayment commencement without incurring pre-closure charges.
Benefits
The Education Loan covers various expenses, including admission and tuition fees, books, stationery, examination fees, boarding and lodging expenses, and insurance premiums.
Quantum of Finance
For professional/technical courses in India, 90% of the expenditure is covered, up to ₹15,00,000 per student. For studies abroad, 85% of the expenditure is covered, up to ₹20,00,000 per student.
For vocational courses, finance is provided based on needs, covering up to 90% of admissible expenses, with limits similar to professional/technical courses.
Rate of Interest
The interest rates specified for the Education Loan scheme are designed to be equitable and accessible to all applicants. For male beneficiaries, the interest rate stands at 4% per annum (p.a.), ensuring affordable repayment terms that support their educational pursuits. In acknowledgment of the challenges often faced by female students and to promote gender inclusivity,
The interest rate for girls is set slightly lower at 3.5% per annum (p.a.). This differential rate reflects a commitment to fostering equal opportunities in education and addressing gender disparities by providing more favorable financial terms for female borrowers. Overall, these interest rates not only facilitate access to education but also strive to create a more balanced and equitable learning environment for all aspiring scholars.
Eligibility Criteria
1. Members of Backward Classes as notified by the Central/State Government.
2. Annual family income capped at ₹3,00,000, with priority given to those with incomes up to ₹1,50,000.
3. Admission to approved professional/technical courses with a minimum of 50% marks in the qualifying exam.
4. Admission through entrance tests/merit-based selection processes.
Application Process
Eligible candidates can apply offline or online through the District Collector or respective Channel Partners (CPs).
Documents Required
– Aadhaar Card
– Passport-sized Photograph
– Educational Qualification Proof
– Caste Certificate
– Annual Family Income Certificate
– Bank Details
This scheme offers a vital lifeline to students from Backward Classes, empowering them to pursue their academic aspirations and build promising futures.
