Axis Bank Education Loan for Higher Studies in India and Abroad
This study loan from Axis Bank helps students finance their dreams of pursuing higher education at recognised educational institutions in India or abroad. The maximum loan amount one can get depends on the cost of the study programme and the repayment capacity of the borrower up to a ceiling of Rs. 75 lakh. Let’s look at its different features:
Features of Axis Bank Education Loan for Higher Studies
Why this Loan?
- The loan is meant to help students who have secured admission into a higher education course in a recognised institution in India or abroad through Entrance Test or Merit-based Selection Process
- This Axis Bank Education Loan is disbursed as a series of payments over the required number of years and not as a lump sum. It can be taken for all expenses directly related to the course including for fees, purchase of books, etc.
- Students can get a loan sanction letter before admission based on their profile
- The minimum loan amount for this loan is Rs. 50,000
- The maximum loan amount you can get depends on the cost of the course and related expenses. The bank decides the loan on a case-to-case basis after assessing the repayment capacity of the borrower or joint borrowers up to the ceiling. As of November 2020, the ceiling for this loan is Rs. 75 lakh
- The interest rate for this loan is defined by Axis Bank as the sum of their Repo Rate + “Spread” where Spread is a variable factor that bank can change during the tenure of the loan. The Repo Rate is reset every 3 months
- Loans up to Rs. 4 lakh: The interest rate for loans up to Rs. 4 lakh is the sum of Repo Rate of Axis Bank + a Spread of 11.20%. As of November 2020, the Repo Rate of Axis Bank is 4.00% which brings the effective interest rate for this loan at 15.20%
- Loans from Rs. 4 lakh up to Rs. 7.5 lakh: The interest rate for loans from Rs. 4 lakh up to Rs. 7.5 lakh is the sum of Repo Rate of Axis Bank + a Spread of 10.70%. As of November 2020, the Repo Rate of Axis Bank is 4.00% which brings the effective interest rate for this loan at 14.70%
- Loans Above Rs. 7.5 lakh: The interest rate for loans above Rs. 7.5 lakh is the sum of Repo Rate of Axis Bank + a Spread of 9.70%. As of November 2020, the Repo Rate of Axis Bank is 4.00% which brings the effective interest rate for this loan at 13.70%
- Until October 2019, the interest rate for Axis Bank Education Loan was calculated using MCLR where MCLR is the Marginal Cost of Funds-Based Lending Rate of the bank
- The bank charges a penal interest of 2% per month on overdue loan instalments
- The repayment period for this loan is 20 years
- 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 moratorium period for this loan is not clearly mentioned on the bank’s website. Please get in touch with the bank for details
- Loans upto Rs. 7.5 lakh do not need any collateral security
- Parents or guardians must be joint borrowers with the student
- Depending on the loan application, the bank may ask for one or more of these as security: a tangible collateral equivalent to the loan amount, assignment of future income of the student or third-party guarantee
- Axis Bank may additionally ask for an insurance policy of value at least equal to the value of the loan
- The applicant must be an Indian national. NRIs can also apply
- The applicant and their co-applicants must be over 18 years of age
- The student should have gained admission into a career-oriented course in a recognised institution in India or abroad through Entrance Test or Merit-based Selection process
- The student should have scored at least 50% marks in Class 10, Class 12 and Graduation if the student is applying for a loan for a Postgraduate course
- Graduate and postgraduate level career-oriented courses in streams such as engineering, management, medicine, etc.
Borrower Contribution to Total Cost (Margin Money)
- Loan up to Rs. 4 lakh: Students do not have to pay margin money
- Loans above Rs. 4 lakh: Students studying in India need to pay 5% of total course expenses as margin money. However, students studying overseas need to pay 15% of total course expenses as margin money
Note: Margin money refers to the amount the borrower contributes to the overall amount required. Suppose a course abroad costs Rs. 40 lakh in which case if the borrower has to provide a margin percentage of 15%, then she will have to provide Rs. 6 lakh, while Axis Bank offers the rest.
Processing and Other Charges
- Loans up to Rs. 10 lakh for Studying in India: No processing charges
- Loans Above Rs. 10 lakh for Studying in India: Rs. 5,000 and applicable GST for secured loans
- Loans up to Rs. 20 lakh for Studying Abroad: Rs. 15,000 and applicable GST
- Loans Above Rs. 20 lakh for Studying Abroad: 0.75% of the differential amount above Rs. 20 lakh and applicable GST
Other Features to Know
- The bank may ask for the student’s progress report to be submitted with the bank at regular intervals
- The loan is disbursed directly to the school, book seller or publisher, computer seller, and so on and not to the applicant(s)
- There are no prepayment charges for the loan
- 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
- For studying abroad, a self-attested copy of the passport is also required along with a self-attested form issued by the institute for visa purposes
- Axis Bank Website: www.axisbank.com
- Headquarters: Mumbai, Maharashtra
- Call Centre Number: 1860 419 5555, 1860 500 5555
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