IDBI Udaan: A Unique Savings-cum-Education-Loan Scheme

IDBI Udaan: Savings-cum-Education-Loan Scheme

This savings-cum-loan scheme helps parents to fund the education of their children studying in Class 8 to 10 up to Class 12 so that they build a corpus to pay for undergraduate courses or other higher studies courses. A new Recurring Deposit (RD) account is opened under this scheme for a tenure of 36 months to 60 months depending on when the student will complete Class 12. The minimum instalment is Rs. 1,000 and in multiples of Rs. 500 thereafter.

Features of Udaan Savings-cum-Education Loan

Why this Loan?

  • This savings-cum-loan scheme is meant to help students save enough money to fund their higher education after completing Class 12
  • It is a pre-approved loan with maximum loan amount of up to 5 times the maturity value of RD
  • The applicant is free to use the maturity value as per his/her choice after the maturity of RD

Loan Amount

  • The maximum loan amount one can get is 5 times the value of RD at the time of maturity. The actual amount is decided by the bank on a case-to-case basis

Interest

  • The interest rate for IDBI Bank education loan products range from 8.25% to 10.25%. The interest rate depends on the type of loan scheme chosen by the applicant
  • The bank charges a penal interest of 2% on overdue amount if the loan amount is over Rs. 4 lakh

Repayment

  • The repayment term of the loan depends on the loan scheme chosen by the applicant
  • The loan amount for each year is repayable in 12 equated monthly instalments, with the first instalment becoming due after the end of moratorium period
  • The bank only accepts Standing Instructions (SI) as a mode of loan repayment

Security Needed

  • Collaterals or guarantee requirements depend on the IDBI loan scheme chosen by the applicant

Eligibility

  • Students studying in Class 8 to Class 10 or parents of students studying in Class 8 to Class 10 are eligible to avail this loan scheme
  • The borrower must be an Indian national
  • The student must open an RD account jointly with the earning parent
  • The student must pay RD instalments on time (without default)

Borrower Contribution to Total Cost (Margin Money)

  • The borrower does not have to offer any margin money to get into the Udaan Savings-cum-Education Loan Scheme. However, the margin money may depend on the education loan schemes availed by the applicant

Note: Margin money refers to the amount the borrower contributes to the overall amount required.

Uses of the Loan

  • This savings-scheme-cum-education-loan can help parents and students build a corpus during the school time for higher education
  • Applying under this scheme means that the applicant will be eligible for a pre-approved loan worth 5 times the maturity value of RD subject to certain conditions

Other Features to Know

  • Since it is an investment scheme, as such the standard features of an education loan do not apply to the IDBI Bank Udaan scheme
  • When a loan is taken, then the terms and conditions that are specific to the loan taken will apply

Documents Needed

  • Application Form duly filled and signed by applicant and/or guarantor along with details of applicant and/or guarantor and family
  • A declaration/ affidavit from the borrower confirming that no educational loans have been availed from other banks
  • Two Passport Size Photographs of student, applicant and/or guarantor
  • Photocopy of PAN Card of the student that needs to be submitted at the time of application or during the course period
  • Personal Identification Proofs (Any One): Electoral I-Card, Passport, Driving License, PAN Card or Aadhaar Card
  • Residential Address Proof (Any One): Electricity Bill, Landline Telephone Bill, Electoral or Voter ID Card or Passport
  • Admission Letter, Course Details and Prospectus as proof of admission
  • Fee Details with Demand of Fee by the Institution
  • All Proofs of Past Academic Record including Mark Sheets and Certificates
  • For the co-borrower, documents as age, ID, signature, address, employment/business/income proofs are required

Reference Facts

  • IDBI Bank Website: www.idbibank.in and www.inet.idbibank.co.in (net banking)
  • Headquarters: Mumbai, Maharashtra
  • Call Centre Toll-Free Number: 1800 209 4324, 1800 22 1070