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United Bank of India Education Loan

Last Modified : September 03, 2018

UBI (United Bank of India) offer variants of education loan schemes viz. United education loan, United Superb education loan and Education Loan for vocational education and training.

The bank offers Education Loan for India and Abroad with various benefits and also have a specialised scheme for students securing admission to top premier institutes.

Why United Bank of India?

Customised variants of education loan to meet the specific needs of borrowers work in favour of the bank. The bank offers high value loan amounts for education in India and Education Loan for abroad.

Are you eligible for UBI Education Loan?

  • Indian National. Borrower and Co-borrower/s must be an Indian National or an NRI having an Indian passport.
  • 10+2. You must have cleared HSC/10+2 from a recognized board or institute
  • Co-signer. Applicant must have a co-signer to act as a co-borrower while applying for loan

How can you apply for UBI Education Loan?

Students opting to avail education loan from United Bank of India can either go through the official website or through Vidyalakshmi Portal. Applicants can also visit the nearest branch and fill the form.

For Online:

  • Visit the official website
  • Click on UBI Education Loan
  • Now select the particular loan scheme you want to apply for
  • Click on Apply Online
  • Fill up the form with all the necessary details
  • Upload the signature, photograph other documents required
  • Submit the Form
  • Take the print out of application form
  • After that visit the nearby United Bank of India for the further proceedings

For Offline

Applicants can directly visit the nearest branch and ask for an application form. The bank representative will then guide you with all the necessary information regarding eligibility, documents required and also which loan is best suitable.

Here are various aspects of student loan offered by UBI. We have curated all the vital information to help you decide.

1. United Education Loan Scheme

UBI offers this variant of education loan to students aspiring to study in India or Abroad. The loan is extended at INR 10 Lacs for studies in India and INR 20 Lacs for studying overseas.

What makes you eligible for UBI Education Loan?

  • Indian National.
  • 10+2 qualified
  • Securing admission in recognized institute in India or abroad
  • Merit based admission
  • Admission to any professional/technical course

Present Rate of Interest

Upto INR7.50 lacMCLR-Y+2.20% i.e. 11.00%
Above INR 7.50 lacMCLR-Y+2.15% i.e. 10.95%

Quick Facts about UBI Education Loan

MarginUp to INR 4 Lacs: Nil
Above INR 4 Lacs: 5%
Maximum Loan LimitINR 10 Lacs
SecurityUpto INR 7.50 Lacs: Nil
Above INR 7.50 Lacs: Co-obligation of parents
Tangible collateral security equivalent to loan amount
Assignment of future income of student for payment of installments.
Moratorium PeriodCourse Period plus one year, or six months after getting a job
Repayment (Maximum)Repayment of the loan can be done after the moratorium period by mode of EMI
Maximum repayment loan: 15 years
Prepayment ChargesNil, if paid during the repayment period

Additional FactsUBI Education Loan

  • 0.50% concession to girl students
  • 1% concession if interest is serviced during moratorium period
  • Zero margin upto INR 4 Lacs
  • Zero Processing Fee

Expenses Covered Under UBI Education Loan

  • Tuition Fee
  • Examination Fee
  • Library/ Laboratory Fee
  • Hostel Fee 
  • Cost of books, equipment, instrument or uniforms
  • Miscellaneous expenses- study tours, project work, thesis, etc.
  • Reasonable cost of computer or laptop (if required)

Courses Covered under UBI Education Loan

  • Postgraduate degree (Masters or Ph.D.) /diploma courses conducted by renowned institutions/ universities recognized by UGC, Government, AICTE, AIBMS or ICMR.
  • Academic courses such as CA, CFA, and ICWAI.
  • Courses conducted by NIFT, IITs, IIMs, XLRI, IISc, and NID.
  • Regular degree or diploma courses like, shipping, pilot training, and aeronautical that are approved by Director General of Civil Aviation or Shipping (only if it is pursued in India).
  • Courses for noble cause such as teaching training (like B.Ed.), nursing courses, and from other training institutions approved by Central Government or by State Government
  • Reputed foreign universities offering approved courses offered in India.

Documents Required for UBI Education Loan

  • Admission letter with all essential details
  • Attested copies of age proof, residence proof and birth date.
  • Self-attested passport size photograph of applicant, co-applicant, and guarantor.
  • Copies of qualifying courses.
  • Income proof and/or copy of income tax return file of co-applicant, parents, and guarantor (if any).
  • Details of collateral security along with government approved valuation certificate (if any)
  • Bank account statement of the applicant.
  • Copy of passport and visa for abroad courses

2. UBI Superb Education Loan

United Bank of India offers UBI Superb Education Loan for students who secure admission to top premier institutes falling under List A, List B and List C.

The loan scheme is extended for professional courses such as Engineering, Medical, and Management, etc.

What makes you eligible for UBI Superb Education Loan?

  • Indian National
  • 10+2 pass
  • Merit based/entrance-exam based admission
  • Admission to premier institutes in India
  • Admission to professional/technical course

Present Rate of Interest

For Students in List A institutesMCLR-Y + 0.05% i.e 8.85%
For Students in List B InstitutesMCLR-Y + 0.55% i.e 9.35%

Quick Facts about UBI Superb Education Loan

MarginList A:
Upto INR 20 Lacs: Nil
Above INR 20 Lac: 5%
List B:
Upto INR 10 Lac: Nil
Above INR 10 Lac: 5%
Maximum Loan LimitINR 30 Lacs
SecurityList A:
Upto INR 20 Lacs: No collaterals
Above INR 20 Lacs: Tangible collaterals equal to amount of loan
List B:
Upto INR 10 Lacs: No collaterals
Above INR 10 Lacs: Tangible collaterals equal to amount of loan
Moratorium PeriodCourse Period plus one year, or six months after getting a job
Repayment (Maximum)Repayment of the loan can be done after the moratorium period by mode of EMI
Maximum repayment loan: 10 years
Prepayment ChargesNil, if paid during the repayment period

Additional Facts about UBI Superb Education Loan

  • 0.25% concession to girl students
  • No concession for interest is serviced during moratorium period
  • Zero Processing Fee

Expenses Covered under UBI Superb Education Loan

  • Tuition Fee
  • Examination Fee
  • Library/ Laboratory Fee
  • Hostel Fee 
  • Cost of books, equipment, instrument or uniforms
  • Miscellaneous expenses- study tours, project work, thesis, etc.
  • Reasonable cost of computer or laptop (if required)

Courses Covered under UBI Superb Education Loan

  • Professional Courses/ technical courses
  • Courses of Engineering, Medical, and Management domain
  • Other courses as per bank’s guidelines

Documents Required for UBI Education Loan

  • Admission letter with all essential details
  • Attested copies of age proof, residence proof and birth date.
  • Self-attested passport size photograph of applicant, co-applicant, and guarantor.
  • Copies of qualifying courses.
  • Income proof and/or copy of income tax return file of co-applicant, parents, and guarantor (if any).
  • Details of collateral security along with government approved valuation certificate (if any)
  • Bank account statement of the applicant.
  • Copy of passport and visa for abroad courses

3. Education Loan for Vocational Education

UBI Education Loan for Vocational Education and Training is offered by United bank of India to students opting for vocational courses.

What makes you eligible for Education Loan for Vocational Education?

  • Indian national
  • 10th pass
  • Certificate/ diploma/ degree course offered or backed by the ministry, national skill development corporation supported organizations, or state skill corporations and state skill missions.

Present Rate of Interest

Interest of rate on loan amount upto INR1.50 lacs is BR + 2.00% = 12.45% per annum

Quick Facts about Education Loan for Vocational Education

MarginNil
Maximum Loan LimitUpto 1 year: INR 50,000
Above 1 year: INR 1,50,000
SecurityNil
Co-obligation of parents/ guardian/ spouse
Moratorium PeriodMaximum of one year
Repayment (Maximum)Upto 1 year: 3 to 5 years
Above 1 year: 5 to 7 years
Margin and Processing FeeNil

Additional Details about Education Loan for Vocational Education

  • Zero margin
  • No collateral security
  • No prepayment/ processing charges
  • 2% penal charges for overdue amount (irrespective of loan amount)
  • The minimum period of this loan scheme is two months and maximum is three years.
  • No age limit
  • Loan is sanctioned conjointly to the applicants and their guardians.

Expenses Covered Under Education Loan for Vocational Education

  • Fee payment to college, institute, university, or skill development centre
  • Examination fee
  • Cost of books, equipment, instrument or uniforms

Courses Covered Under Education Loan for Vocational Education

All vocational education courses for a minimum period of 2 months and a maximum period of 3 years approved by Central Government or by State Government.

Documents Required for Education Loan for Vocational Education

  • Admission letter
  • Attested copies of age proof, residence proof and birth date.
  • Self-attested passport size photograph of applicant, co-applicant, and guarantor.
  • Copies of qualifying courses.
  • Income proof and/or copy of income tax return file of co-applicant, parents, and guarantor (if any).
  • Bank account statement of the applicant.

FAQs

Q: What schemes does UBI considers for its education loans?

Answer: There are no other schemes offered by UBI apart from the basic education loans.

Q: In whose name is the loan granted?

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

Q: 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.

Q: What is the age limit for availing loan in UBI?

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

Q: Are minors eligible to apply for UBI Education Loan?

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

Q: 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.

Q: 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.

Q: Where can I avail UBI 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.

Q: Is there any provision to apply for loan online?

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

Q: Can I view my loan statement online if I am an existing education loan borrower?

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

Q: Is there any minimum aggregate marks to meet the eligibility criteria to avail UBI 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

Q: What is the discount/ rebate offered by UBI?

Answer:

  • 0.50% concession is given to girl students
  • 1% concession if interest is serviced during moratorium period

Q: What all is included in tangible collateral security?

Answer: Mostly UBI asks tangible security in lieu of the loan amount sanctioned along with assignment of future salaries in favour of UBI. 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.

Q: Is scholarship or assistantship included in the margin?

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

Q: What is Moratorium Period?

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

Q: What is tenure of an education loan?

Answer: Tenure of education loan provided by UBI is maximum 15 years. Tenure of UBI Superb Education Loan is 10 years.

Q: 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.

Q: What all expenses are covered under this course?

Answer: Expenses covered by UBI education loan are:

  • Tuition/ college/ hostel fee
  • Examination/ lab/ library fee
  • Books/ uniform/ instruments
  • Caution deposit
  • Passage money for studies abroad, etc.

Q: 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.

Q: 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)

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

Answer: UBI provides a special loan scheme with various benefits to students who have secured admission in top rated institutes like IITs, IIMs, XLRI, ISB, IIFT, NITs, etc.

Q: What is the processing fee or prepayment charges?

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

Q: 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. 

Q: 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

Q: Are diploma or certificate courses considered under UBI education Loan (both for India and Abroad)?

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

Q: Is a co-borrower necessary for loan?

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

Q: 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.

Q: 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).

Q: How many guarantors do I need to borrow loan from UBI?

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

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 for UBI Education Loan and 10 years

Q: 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.

Q: 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 UBI’s official website.

Q: What are the charges for late EMI payment?

Answer: 24% per annum on outstanding amount is charged for the late EMI payment

Q: 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

Q: 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. 

Q: 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. 

Q: What is interest rate of education loan?

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

  • UBI Education Loan:

Upto INR7.50 lac

MCLR-Y+2.20% i.e. 11.00%

Above INR 7.50 lac

MCLR-Y+2.15% i.e. 10.95%

  • UBI Superb Education Loan:

For Students in List A institutes

MCLR-Y + 0.05% i.e 8.85%

For Students in List B Institutes

MCLR-Y + 0.55% i.e 9.35%

  • UBI Education Loan for Vocational courses: Interest of rate on loan amount upto INR 1.50 lacs is BR + 2.00% = 12.45% per annum

Q: What is interest subsidy on education loan?

Answer: UBI offers CSIS interest subsidy on education loans offered.

Q: 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.

Q: 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).

Q: 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.

Q: 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

Q: Are there any additional benefits on availing loan from UBI?

Answer: There are no additional benefits mentioned by the bank  

Q: 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.

Q: 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: 1800-345-0345
  • Customer Care Id: webmaster@unitedbank.co.in