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Canara Bank Education Loan for India

Last Modified : May 07, 2018

Government of India owned Canara Bank is two decades old bank that have gradually turned itself into third largest public sector bank. It is one of the oldest bank with large network of 6639 branches and more that 10600 ATMs spread across the country.

Providing Education to all is the basic right and as well as duty of every individual. The monetary burden that tags along with higher education often deprives students of pursuing their higher studies. To ease the burden and support students in their education, Canara Bank have launched multiple education loan schemes viz. Vidya Sahay, Vidya Turant, Education Loan for Students, and Model Loan Scheme for Vocational Education and Training

Interested students can also avail for various other schemes such as Central Sector Interest Subsidy Scheme for Education Loan, and Padho Pardesh Interest Subsidy Scheme for Education Loans to students belonging to Minority Community to ease their loan liability.

1. Education Loan for Students- IBA Model Loan Scheme for Students pursuing Higher Studies in India

Canara Bank launched Education Loan Scheme for students who wish to pursue higher studies in India from reputed universities. The scheme is to ensure the academic excellence among students and to make nation ahead in terms of education sector.

Eligibility to avail Canara Bank Education Loan

  • Student must be an Indian National
  • He/ She must have secured admission to Graduation/ Post Graduation/ Diploma courses in any recognized institute approved by State or Central Government.
  • He/ She must have passed required course with essential grades

Key Details of Canara Bank Education Loan

  • Zero Margin for Loan upto INR 4 Lacs
  • No collateral is required if the loan is less than INR 4 Lacs
  • Loan is sanctioned conjointly to the applicant and his/ her guardian.

Present Rate of Interest

Category

ROI

Present ROI

Loan amount upto INR 4 Lacs

1 year MCLR + 2.00%

10.40%

Loan amount between INR 4 to 7.50 Lacs

1 year MCLR + 2.00%

10.40%

Loan amount above INR 7.50 Lacs

1 year MCLR + 1.80%

10.20%

Vidya Turant

1 year MCLR + 0.20%

8.60%

IBA Model Education Loan Scheme for Vocational Education and Training

1 year MCLR + 1.50%

9.90%

Margin

Upto INR 4 Lacs: Nil

Above INR 4 lacs: 5%

 

Maximum Loan Limit

INR 10 Lacs

Security

Less than INR 4 Lacs: No Collateral required

From INR 4 to 7.5 Lacs: Guarantee of bank approved third party

Above INR 7.5 Lacs: Collateral Security equal to amount of loan

Assignment of students future salary towards the bank 

Moratorium Period

Course Period + 1 year

Repayment (Maximum)

Repayment of the loan can be done after the moratorium period by mode of EMI

Upto INR 7.5 Lacs: 10 years

Above INR 7.5 Lacs: 15 years

Prepayment Charges

Nil

Expenses covered under Canara Bank Education Loan

  • Payment of Fee to College, Institute or University
  • Examination Fee or payment of fee to library or laboratory
  • Hostel Fee and other charges applicable
  • Cost of Books, equipment, instrument or uniforms
  • Miscellaneous expenses required for completion of the course- study tours, project work, thesis, etc.
  • Reasonable cost of computer or laptop (if required)

Courses Covered under Canara Bank Education Loan

  • All Graduation, Post- Graduation or Doctorate courses
  • Professional Courses including Medical, Law, Dental, Engineering, Hospital Management, Hotel Management, Event Management, Mass Communication, Fashion Studies, Agricultural Studies, etc.
  • Courses that are offered by reputed foreign universities in India
  • Regular or Evening Courses conducted by colleges/ universities approved by UGC/ Government/ AICTE/ AIBMS/ ICMR etc.
  • Degree or Diploma courses in Teacher Training, Nursing, B.Ed provided the training institutes are approved by Central/ State Government.

Documents required for Canara Bank Education Loan

  • Identity Proof such as Passport, Voter’s ID, Driving Licence or PAN Card
  • Mark sheet of recently qualified public exam for school, college in India
  • Admission Proof: Fee receipts, Transfer certificate, etc.
  • Schedule of expenses for course
  • Two recent passport size photographs of applicant, co-obligant and guarantor
  • Educational Proof such as copy of admission letter along with fee structure, mark sheets, SSC, HSC and degree course certificates
  • Salary Proof such as Latest salary slip, Form 16 and recent salary certificate

2. Model Loan Scheme for Vocational Education and Training

Vocational courses are job oriented short term courses that enhance students’ knowledge in specific field and prepare them for the industry. Canara Bank has initiated Model Loan Scheme for Vocational Education and Training to extend a helping hand to students by financing expenses throughout the course.

Eligibility to avail Model Loan Scheme for Vocational Education and Training

  • Students must be an Indian national
  • He/ She should have completed 10th standard (SSC)
  • He/ She must have secured admission to course approved by State/ Central Government

Key Benefits of Model Loan Scheme for Vocational Education and Training

  • No Margin applied to the loan
  • No security in lieu of the loan sanctioned
  • Loan can be availed from nearest Canara Bank branch

Margin

Nil

 

Maximum Loan Limit

Course with 3 months duration: INR 20,000

Course with 3-6  months duration: INR 50,000

Courses with 6 months- 1 year duration: INR 75,000

Courses above 1 year duration: INR 1,50,000

Security

No security is required

No collateral or third party guarantee is asked for.

Moratorium Period

For course upto 6 months: Course Period + 6 months

For courses above 6 months duration: Course Period
+ 1 year

Repayment (Maximum)

Course with 3 months duration: 2-5 years

Course with 3-6  months duration: 2-5 years

Courses with 6 months- 1 year duration: 2-5 years

Courses above 1 year duration: 3-7 yeras

Prepayment Charges

Nil

Expenses Covered under Model Loan Scheme for Vocational Education and Training

  • Payment of Fee to College, Institute or University
  • Examination Fee or payment of fee to library or laboratory
  • Hostel Fee and other charges applicable
  • Cost of Books, equipment, instrument or uniforms
  • Miscellaneous expenses required for completion of the course- study tours, project work, thesis, etc.
  • Reasonable cost of computer or laptop (if required)

Courses Covered under Model Loan Scheme for Vocational Education and Training

  • Vocational or Development courses of 2 months to 3 years duration
  • The course should lead you certificate, degree or diploma by a renowned organization.
  • University/ Institute should be approved by State/ Central Government

Documents required for Model Loan Scheme for Vocational Education and Training

  • Identity Proof such as Passport, Voter’s ID, Driving Licence or PAN Card
  • Mark sheet of recently qualified public exam for school, college in India
  • Admission Proof: Fee receipts, Transfer certificate, etc.
  • Schedule of expenses for course
  • Two recent passport size photographs of applicant, co-obligant and guarantor
  • Educational Proof such as copy of admission letter along with fee structure, mark sheets, SSC, HSC and degree course certificates
  • Salary Proof such as Latest salary slip, Form 16 and recent salary certificate

3. Vidya Sahay- Bridge loans to students who appear for counselling at CET Centres

Vidya Sahay, an education loan initiative by Canara bank is to extend financial support to students who have to appear for counselling at any CET centres. The loan scheme is launched to assist the merit students in need of down payment to be made to CET authorities at time of counselling.

Eligibility to avail Vidya Sahay Education Loan

  • Student should be an Indian national
  • He/ she must have cleared previous qualifying exam
  • Students who appeared in entrance test conducted by State/ CBSE/ IIT and similar all Indian National Examination conducting authority
  • He/ She must have cleared the exam and selected for counselling process

Key Benefits ofVidya Sahay Education Loan

  • No processing or documentation charges applicable
  • No margin applied
  • No security asked in lieu of the loan sanctioned

Present Rate of Interest

Vidya Sahay Education Loan

As applicable on education loans: 11.50% (BR+1.5%)

DRI rate to students who qualify DRI norms

Margin

Nil

 

Maximum Loan Limit

INR 1 Lac or initial payment as proposed by CET authorities (whichever is less)

Security

No security is required

No collateral or third party guarantee is asked for.

Moratorium Period

Course Period+ 1 year

Repayment (Maximum)

Bridge loan is to be cleared after the sanction of regular education loan

Prepayment Charges

Nil

4. Vidya Turant

Vidya Turant is an initiative launched under Canara Bank’s Education loan scheme for students who wish to pursue higher studies in premier institutions. The scheme is launched to extend a helping hand to students who have secured admission to premier Institutions.

Eligibility to avail Vidya Turant Education Loan

  • Student should be an Indian National
  • He/ she should have qualified previous qualifying exam
  • He/ She should have been selected through entrance exam conducted by competent authorities
  • Students must have secured admission to renowned and reputed Institutes viz. IIMs, IITs, NITs, IISc, and other such institutes. (List of institutes that are approved under this loan is mentioned below)

Key Details of Vidya Turant Education Loan

  • No processing charges
  • No prepayment fee
  • No provision of 0.5% concession to girl students
  • Parent/ guardian has to join as co-borrower

Margin

5%

 

Maximum Loan Limit

IIMs: INR 25 Lacs

ISB Hyderabad, Mohali: INR 36 Lacs

Institutes other than List A or List B: INR 20 Lacs

Security

No security upto the limit designated to particular institute (students of IIMs: INR 25 Lacs, students of ISB: INR 36 Lacs and students of other institutes: upto INR 20 Lacs)

Assignment of future income towards bank

Moratorium Period

Course Period + 1 year or 6 months after getting job

Repayment (Maximum)

15 years (irrespective of loan amount)

Prepayment Charges

Nil

Expenses Covered under Vidya Turant Education Loan

  • Payment of Fee to College, Institute or University
  • Examination Fee or payment of fee to library or laboratory
  • Hostel Fee and other charges applicable
  • Cost of Books, equipment, instrument or uniforms
  • Miscellaneous expenses required for completion of the course- study tours, project work, thesis, etc.
  • Reasonable cost of computer or laptop (if required)
  • Insurance premium for student

List of Institutes that fall under A and B Category

VIDYA TURANT SCHEME -

 LIST OF APPROVED INSTITUTONS AND DESIGNATED  BRANCHES

Sl.No.

INSTITUTION

BRANCH

CIRCLE OFFICE

CATEGORY-A

1

Indian Institute of Management, Ahmedabad

Ahmedabad,  Vastrapur DP Code-2637

AHMEDABAD

2

Indian Institute of Management, Bangalore

Arakere Gate Branch, DP Code 2753

BANGALORE

3

Indian Institute of Management, Indore

Indore RNT Marg DP Code-0359

BHOPAL

4

Indian Institute of Management, Kozhikode

Calicut West Hill DP Code-833

TRIVANDRUM

5

Indian Institute of Management, Kolkata

Thakurpukur Branch D P Code-8626

KOLKATA

6

Indian Institute of Management, Lucknow

Lucknow Janakipuram DP Code-3210

LUCKNOW

7

Indian Institute Management, Ranchi

Kanke Road, Ranchi, DP Code 2869

RANCHI

8

Indian Institute Management, Trichy

NIT, Thuvkudi, DP Code 3314

MADURAI

9

Indian Institute Management, Rohtak

Rohtak MainDP Code 1171

KARNAL

10

Indian Institute Management, Udaipur

Udaipur Main, UdaipurDP Code 2982

JAIPUR

11

Indian Institute Management, Kashipur

Kashipur DP Code 2795

DELHI

12

Indian Institute Management, Raipur

Raipur Main, Raipur, DP Code 381

BHOPAL

13

Indian Institute of Management, Mananwala, Amritsar.

  1.  

(DP Code : 6177 )

  1.  

 

CATEGORY-B

14

Indian School Of Business, Mohali, Sector 8A, SAS Nagar, Mohali – 140 306

Mohali, IISER Campus DP Code 4790

CHANDIGARH

15

Indian School Of Business, Hyderabad

Madhapur branch, DP 3091

HYDERABAD

CATEGORY-C

16

Rajiv Gandhi Indian Institute of Management, Shillong

Shillong Main D P code-1184

GUWAHATI

17

IIT, Madras

IIT, Chennai, D P Code-2722

CHENNAI

18

IIT, Roorkee

Roorkee DP Code-2200

DELHI

19

IIT, Delhi

IIT Delhi Branch, IIT Campus, Hauz Khas, Delhi, D P Code-8599

DELHI

20

IIT, Guwahati

IIT Guwahati D P Code-8652

GUWAHATI

21

IIT, Kharagpur

Kharagpur Branch D P Code-0190

DURGAPUR

22

IIT (BHU)

Varanasi Lanka DP Code-2453

LUCKNOW

23

IIT, Kanpur

Kanpur Mall Road DP Code- 1195

LUCKNOW

24

IIT, Patna

Pataliputra Colony  Branch, Patna ,(DP Code 2518)

PATNA

25

IIT, Mumbai

Mumbai IIT, Powai DP Code-2724

MUMBAI

26

Indian Institute of Technology,

Bhilai, Chhattisgarh

Raipur, SejbaharBranch

(DP Code : 5142 )

BHOPAL

27

NIT, Rourkela

Rourkela Main,  DP Code 0395

BHUBANESWAR

28

NIT, Calicut

Koduvally DP Code-3487

TRIVANDRUM

29

NIT, Srinagar

Srinagar Main DP Code-1190

CHANDIGARH

30

NIT, Hamirpur

Hamirpur DP Code-3238

CHANDIGARH

31

NIT, Agartala

NIT, Agartala D P Code-4121

GUWAHATI

32

NIT, Kurukshetra

Kurukshetra Branch, D P Code 2475

KARNAL

33

NIT, Durgapur

Durgapur NIT Campus Branch, D P Code-8569

KOLKATA

34

NIT Silchar

Silchar, DP Code-3050

GUWAHATI

35

NIT,  Karnataka, Surathkal

Surathkal NITK Camp D P Code-8517

MANGALORE

36

NIT, Raipur

GE Road, Raipur D P Code-2555

BHOPAL

37

NIT, Patna

Patna Exhibition Road DP Code-2004

PATNA

38

NIT, Jamshedpur

Jamshedpur Bistupur, DP Code 0324

DELHI

39

NIT, Tiruchirappalli

Trichy Thuvakudi DP Code- 3314

MADURAI

40

NIT, Warangal

Hanumakonda, DP Code 2450

HYDERABAD

41

Motilal Nehru National Institute of Technology, Allahabad

Allahabad Civil Lines, DP Code-0627

LUCKNOW

42

Visvesvaraya National Institute of Technology, Nagpur

VNIT, Nagpur D P Code-3124

PUNE

43

Xavier Institute Of Management, Bhubaneswar

ICMR, Bhubaneshwar, DP Code 2957

BHUBANESWAR

44

Faculty Of Management Studies(FMS)

Kamalanagar 3F, Delhi,DP Code 0156

DELHI

45

Management Development Institute(MDI)

Gurgaon Main, Gurgaon,DP Code 1723

KARNAL

46

Institute Of Management Technology-IMT

Ghaziabad Main, Ghaziabad,DP Code 1149

DELHI

47

S. P.Jain Institute Of Management and Research, Mumbai – 400 058

Andheri West (SSB), Mumbai, DP Code 2667

MUMBAI

48

Jamnalal Bajaj Institute Of Management Studies(JBIMS), Reclaimation, Mumbai

Nariman Point, Mumbai,DP Code 172

MUMBAI

49

K.J.Somaiya Institute Of Management Studies And Research

Chembur Amarmahal, Mumbai DP Code 232

MUMBAI

50

Symbiosis Institute Of Business Management(SIBM), Pune

MSFC Branch, PuneDP Code 2829

PUNE

51

Symbiosis Centre for Management and Human Resource Development (SCMHRD)

Model Colony, Pune  DP Code 262

PUNE

52

Xavier Labour Relations Institute (XLRI)

Bistupur Main,JamshedpurDP Code 0324

RANCHI

53

Narsee Monjee Institute Of Management Studies (NMIMS),  Mumbai – 400 056

JVPD Scheme, MumbaiDP Code 0121

MUMBAI

54

BITS – Pilani

Jhunjhunu Branch,(DP Code 2330)

JAIPUR

55

International Management Institute (IMI), Delhi

Jit Singh Marg Branch,(DP Code 1484)

DELHI

56

IRMA – Anand

Anand Main Branch,(DP Code 0163)

AHMEDABAD

57

Indian School of Mines (ISM), Dhanbad

Seraidhela Branch (DP Code 0986)

RANCHI

58

Indian Institute of Foreign Trade, New Delhi

Jit Singh Marg Branch,(DP Code 1484)

  DELHI

59

NITIE – Mumbai

IIT, Powai Branch,(DP Code 2724)

MUMBAI

60

Shailesh J Mehta Institute of Management, Mumbai

IIT, Powai Branch,(DP Code 2724)

MUMBAI

61

Indian Institute of Sciences  (IISc), Bangalore

Indian institute of Sciences branch, DP 0683

BANGALORE

62

S.V. National Institute of Technology, Surat

Surat KM Road Main- DP Code-336

AHMEDABAD

63

Maulana Azad National Institute of Technology

Bhopal New Market D P Code- 2651

BHOPAL

64

Dr. B.R. Ambedkar National Institute of Technology, Jalandhar

Dr. B.R. Ambedkar National Institute of Technology,Jalandhar DP Code-2945

CHANDIGARH

 

65

Malaviya National Institute of Technology, Jaipur

Jaipur Malviya Nagar DP Code-2550

JAIPUR

66

Birla institute of Technology,Mesra,Ranchi

Ormanjhi Branch ( DP Code 5708)

RANCHI

67

MICA ( Mudra Institute of Communications, Ahmedabad )

Bopal Branch ( DP Code 3423)

AHMEDABAD

68

A: NID ( National Institute of Design , Gandhinagar)

Gandhi nagar Branch ( DP Code 2381),

AHMEDABAD

 

B: NID (National Institute of Design,Ahmedabad)

Paldi Branch ( DP Code 0174)

AHMEDABAD

69

Institute of Management, NIRMA University. Ahmedabad

Thaltej Branch ( DP Code 3180)

AHMEDABAD

70

IIT, Hyderabad, Telangana

Yeddumailaram Branch(DP Code 3458)

  1.  

71

National Institute of Foundry and Forge Technology (NIFFT), Ranchi, Jharkhand

NIFFT Campus Branch (DP Code 2730)

  1.  

72

IIT, Jodhpur, Rajasthan

Jodhpur Main( DP Code 1088)

  1.  

73

  1.  

Information &Technology University, Jaipur

Saint Angella Sophia School Branch

( DP Code 8465)

  1.  

74

International Management

Institute (IMI),Kolkata, West Bengal

Alipore, Kolkata, ( DP Code : 0254)

  1.  

75

T. A. Pai Management Institute (TAPMI), Manipal , Karnataka

Udupi Town Branch (DP Code :0630)

  1.  

76

Indian Institute of Information Technology(IIIT), Allahabad,

Allahabad Main, (DP Code : 0627)

  1.  

77

Indian Institute of Technology

(IIT) Gandhinagar, Gujarat

IIT,Gandhinagar Branch,

( DP Code: 5159)

  1.  

78

Bharathidasan Institute of Management, Tiruchirappalli

Thuvakudi Branch, ( DP Code: 3314)

  1.  

79

Indian Institute of Technology(IIT), Indore

Simrol IIT Branch,(DP Code : 6223)

  1.  

80

Indian Institute of Technology(IIT), Palakkad

IIT, Palakkad Branch,

(DP Code: 6174)

  1.  
FAQs
  1. What schemes does Canara Bank considers for its education loans?

Answer: There are multiple other schemes offered by Canara Bank apart from the basic education loans. These are:

  • CSIS Scheme
  • Padho Pardesh
  • Model Loan Scheme for Vocational Education and Training
  • Vidya Sahay
  • Vidya Turant
  1. In whose name is the loan granted?

Answer: The loan is granted in the name of the student

  1. Is the loan contract executed only in student’s name?

Answer: No, the loan can be executed both in name of student and co-borrower as both are equally responsible for repayment of loan.

  1. What is the age limit for availing loan in Canara Bank?

Answer: There is no age restriction for the applicant applying for education loan from Canara Bank. He/ she should only meet the other stated eligibility criteria’s.

  1. Are minors eligible to apply for Canara Bank Education Loan?

Answer: Yes, Minors aspiring for further studies can apply for education loan with help of legal representation from parents/ guardians.

  1. What does margin on any loan mean?

Answer: Margin amount is the amount that a borrower has to pay through his/ her own sources in form of a down payment as his/ her contribution towards the education.

  1. Should the student’s margin be paid upfront in the starting?

Answer: Margin can be paid on a year to year pro rata basis whenever bank disburses loan amount as per requirement.

  1. Where can I avail Canara Bank Education Loan?

Answer: You can either contact your nearest branch for the application form or details regarding the loan or apply online from the official website.

  1. Is there any provision to apply for loan online?

Answer: : Yes, you can apply online through Vidyalakshmi portal to avail for this loan.

  1. Can I view my loan statement online if I am an existing education loan borrower?

Answer: Yes, by creating a login on Canara Bank web portal, you can view all details related to education loan online.

  1. Is there any minimum aggregate marks to meet the eligibility criteria to avail Canara Bank education loan?

Answer: Yes, a student must have secured a minimum aggregate marks in their last qualifying examination (10+2 or Graduation). Relaxation in the marks is given to SC/ ST students

  1. What is the discount/ rebate offered by Canara Bank?

Answer:

  • 0.50% concession is given to girl students
  • Eligibility criteria and margin on education loan is relaxed for SC/ST students
  1. What all is included in tangible collateral security?

Answer: Mostly Canara Bank asks tangible security in lieu of the loan amount sanctioned along with assignment of future salaries in favour of Canara Bank. Tangible security includes documents related to land/ building/ government security/ public sector bonds/ units of UTI, NSC, Life insurance policy/ bank deposits/ shares or debentures. The value of the security should be equal to the education loan amount.

  1. Can I place my family property as collateral?

Answer: Yes, but it will need consent of all family members involved.

  1. Is scholarship or assistantship included in the margin?

Answer: Yes any scholarship or assistantship will be a part of margin charged on education loan.

  1. What is Moratorium Period?

Answer: Course Period plus one year, or six months after getting a job

  1. What is tenure of an education loan?

Answer: Tenure of education loan provided by Canara Bank is maximum 15 years

  1. What does MCLR stands for?

Answer: MCLR stands for Marginal Cost of funds based Lending Rate. It refers to the minimum interest rate of bank below which it cannot lend.

  1. What all expenses are covered under this course?

Answer: Expenses covered by Canara Bank education loan are:

  • Tuition/ college/ hostel fee
  • Examination/ lab/ library fee
  • Books/ uniform/ instruments
  • Caution deposit
  • Passage money for studies abroad, etc.
  1. I have taken admission through management quota. Am I eligible?

Answer: This depends totally on bank’s discretion as whether a student meets other eligibility criteria or not.

  1. What do you mean by reputed or recognized institutes?

Answer: Institutes that are affiliated to state/ central universities and comes under UGC or AICTE are considered as recognized institutes. Reputed institutes are those which are well known and have standard course of repute. More often, banks provide the list of institutes they consider for loan. (You can contact nearest branch for the same)

  1. Are there any special benefits if I have secured admission to one of the top premier institutes?

Answer: Canara Bank provides 1% concession to students who have secured admission in top rated institutes like IITs, IIMs, XLRI, ISB, IIFT, NITs, etc.

  1. What is the processing fee or prepayment charges?

Answer: The education loan offered by Canara Bank have no prepayment, processing or documentation charges.

  1. Will cost of my computer be covered under the loan sanctioned?

Answer: Reasonable cost for the computer or laptop well be covered under the loan if it is required to complete the course. 

  1. Why is Pan Card necessary?

Answer: Pan Card is one of the mandatory document required by banks these days. It is mandatory because:

  • Easy to assess Income
  • Easy to trace borrowers
  1. Are diploma or certificate courses considered under Canara Bank education Loan (both for India and Abroad)?

Answer: Diploma courses are eligible under Canara Bank Education Loan. Regular degree or diploma courses like, shipping, pilot training, and aeronautical that are approved by Director General of Civil Aviation or Shipping.

  1. Is a co-borrower necessary for loan?

Answer: Yes, it is mandatory to have a co-borrower to avail loan from Canara Bank.  

  1. Who can be my co-borrower?

Answer: Your parent/ spouse/ guardian can be a co-borrower. A co-borrower should be your immediate family member, should have a steady source of income, and a good credit history.

  1. What all documents are required from the co-borrower?

Answer: Documents required from the co-borrower are:

  • Attested copies of age proof, residence proof and birth date.
  • Self-attested passport size photograph
  • Income proof and/or copy of income tax return file
  • Details of collateral security along with government approved valuation certificate (if any).
  1. How many guarantors do I need to borrow loan from Canara Bank?

Answer: You need at least 2 guarantors to avail loan from Canara Bank.

Q.What is the KYC requirement in education loan?

Answer: KYC requirements are the documents as a proof of personal identification and residence proof of the applicant as well as the co-borrower.

Q.What are maximum term for repayment?

Answer: Maximum Term for repayment for Loan is 15 years

  1. How can I repay the loan?

Answer: You can repay the loan after the moratorium period by mode of EMI or through post- dated cheques.

  1. What is EMI? How are they calculated?

Answer: EMI stands for Equated Monthly Installments. It can be calculated by using the formula given below

  • EMI = [P x R x (1+R) ^n] / [(1+R)^ n-1]
  • Here, P is Amount of Education Loan, R is Rate of Interest, n is Tenure of the Loan.
  • Or simply you can use the EMI calculator provision available on Canara Bank’s official website.
  1. What are the charges for late EMI payment?

Answer: 24% per annum on outstanding amount is charged for the late EMI payment and INR 500 for every bounced cheque.

  1. Is the loan disbursed in name of individual applicant or to the institute/ university directly?

Answer: The loan is disbursed directly to the institute/ university that you have taken admission to. Hence, an applicant is supposed to submit institute brochure with proper division of the fee

  1. If I am unable to complete my course in given tenure, will my repayment term be extended?

Answer: It is completely on the banks discretion to extend the moratorium period or not. It can be extended for maximum 2 years based on student’s reason. You can contact your nearest branch for more details.  

  1. What is method of application of interest on education loan?

Answer: The interest will be charged at simple rate from the date of disbursement till commencement of repayment of loan. After that, compound interest is charged on reducing balance. 

  1. If I am joining the course soon after current course, can I get an extension?

Answer: Mostly, in such cases, you do not get an extension and even if you do there is a possibility that interest rates are higher

  1. What is interest rate of education loan?

Answer: The interest rate is different for different loan offered. Refer the tables below:

Category

ROI

Present ROI

Loan amount upto INR 4 Lacs

1 year MCLR + 2.00%

10.40%

Loan amount between INR 4 to 7.50 Lacs

1 year MCLR + 2.00%

10.40%

Loan amount above INR 7.50 Lacs

1 year MCLR + 1.80%

10.20%

Vidya Turant

1 year MCLR + 0.20%

8.60%

IBA Model Education Loan Scheme for Vocational Education and Training

1 year MCLR + 1.50%

9.90%

  1. What is interest subsidy on education loan?

Answer: Canara Bank offers

  • Interest Subsidy scheme for economically weaker sections and to promote education amongst them
  • Model Loan Scheme for Vocational Education and Training- for students who wish to pursue vocational courses and enhance their career prospects.
  • Padho Pardesh scheme for students who wish to pursue studies abroad
  • Vidya Turant education loan scheme for students who secured admission to any premier institutes such as IITs, IIMs, XLRI, ISB, etc.
  1. What documents do I need to submit to avail interest subsidy scheme?

Answer: The documents that need to be submitted are:

  • Income certificate issued by authorised authorities
  • Bonafide student certificate
  • Letter of undertaking or declaration signed by borrower/ co-borrower
  1. What is employment verification in an education loan?

Answer: The bank takes the responsibility to cross verify all the employment details of the applicant and co-borrower. If the banks fails to cross verify every detail provided, it might reject the loan application.

  1. Are there any tax benefits in education loans?

Answer: Under Section 80E of Income Tax Act, loan borrowers can avail the tax benefits. This benefit is only available over and above INR 1,50,000. Tax benefits can be availed once the borrower starts paying interest on loan. The deduction is available until borrower pays off full interest amount on loan or for maximum of 8 years (whichever is earlier).

  1. Is it necessary to have bank account with the bank while availing loan from that particular bank?

Answer: It is not necessary to have a bank account while availing the loan but it makes it easier for the borrower to get loan application approved.

  1. Why do banks require insurance policy as security?

Answer: The banks require insurance policy as security in lieu of education loan provided. The insurance policy should be equal or more to the amount of loan sanctioned. In case of untimely demise of the borrower, the bank recovers the amount from the insurance policy

  1. Are there any additional benefits on availing loan from Canara Bank?

Answer: Borrower can opt for Group Credit Life Insurance Cover. The insurance premium of which will be financed by bank.

  1. What is credit score? Is it important for education loan?

Answer: Credit Score is inclusive of various factors such as credit history (Loan history or credit card). If a student does not have a credit score, banks calculate it by considering factors such as University, College and the Course of admission. Banks consider the academic background of student and credit history of co-borrower.

  1. If a student have any query, where or whom to contact?

Answer: student can reach out to the nearest branch in case of any query.

Customer Care Number: 080- 22221581/ 582, 080- 222204990/ 0491/ 1788/ 1789/ 1790/ 1984/ 1985/ 1986

Customer Care Id: csscodel@canarabank.com

Local rates apply on every call