Bank of Baroda Loan for Students of Premier Institutes

Baroda Education Loan to Students of Premier Institutions

This loan helps students who have gained admission into premier educational institutions in India to pay for their course fees. The maximum loan amount that you can apply for is Rs. 80 lakh with security. The maximum loan you can get without security depends on Bank’ of Baroda’s categorisation of the institute. Details are below.

Features of Baroda Education Loan to Students of Premier Institutions

Why this Loan?

• The loan is meant for you if you have gained admission into a graduate, post-graduate, PhD, professional or any other course in a premier educational institution in India
• The bank disburses the Baroda Education Loan to Students of Premier Institutions as a series of payments over the required number of terms or years to pay the course fees or other approved charges

Loan Amount

• The maximum loan amount one can get with security is Rs. 80 lakh
• If you choose to get the loan without security, the maximum amount you are eligible to get depends on the category under which your institution falls. Bank of Baroda has classified the premier institutions in India into four categories, viz. AA, A, B and C. The list can be downloaded from the bank’s website
• Category AA Institutes: Maximum loan you can get without security if you gain admission into an AA institute is Rs. 40 lakh
• Category A Institutes: Maximum loan you can get without security if you gain admission into an A institute is Rs. 20 lakh
• Category B & C Institutes: Maximum loan you can get without security if you gain admission into a B or C institute is Rs. 7.5 lakh
• The bank also offers need-based finance based on the future repayment capacity of the student based on past placement records and average pack packages

Interest

• Category AA and A: If you gain admission into a Category AA or A premier institute, the interest rate charged will be the Baroda Repo Linked Lending Rate (BRLLR) which is currently 7.0o%
• Category B Institutes and Loans up to Rs. 7.5 lakh: These loans are charged the sum of Baroda Repo Linked Lending Rate (BRLLR) which is currently 7.00% and an additional 0.75%. This comes to 7.75%
• Category B Institutes and Loans above Rs. 7.5 lakh: These loans are charged the sum of Baroda Repo Linked Lending Rate (BRLLR) which is currently 7.00% and an additional 0.50%. This comes to 7.50%
• Category C Institutes and Loans up to Rs. 7.5 lakh: These loans are charged the sum of Baroda Repo Linked Lending Rate (BRLLR) which is currently 7.00% and an additional 1.50%. This comes to 8.50%
• Category C Institutes and Loans above Rs. 7.5 lakh: These loans are charged the sum of Baroda Repo Linked Lending Rate (BRLLR) which is currently 7.00% and an additional 1.25%. This comes to 8.25%
• Girl students get a 0.5% concession in the interest rate
• Simple interest is charged monthly during the repayment moratorium period
• The accrued interest during the moratorium period is added to the principal amount to arrive at the fixed Equated Monthly Instalment (EMI)
• The bank charges a penal interest of 2% on overdue amount if the loan amount is over Rs. 4 lakh

Repayment

• The repayment moratorium is for the course duration and an additional grace period of 1 year but simple interest is charged for this moratorium period
• A loan of up to Rs. 7.5 lakh needs to be repaid in 10 years in equal monthly instalments (EMIs) after the moratorium ends while loans above Rs. 7.5 lakh need to be repaid in 15 years as EMIs

Security Needed

• Loans for Category AA Institutions: Loans up to Rs. 40 lakh need only a co-obligation of parents and no security. Loans above Rs. 40 lakh need collateral security for the entire loan amount. An assignment of future income is needed in both cases
• Loans for Category A Institutions: Loans up to Rs. 20 lakh need only a co-obligation of parents and no security. Loans above Rs. 20 lakh need collateral security for the entire loan amount. An assignment of future income is needed in both cases
• Loans for Category B and C Institutions: Loans up to Rs. 7.5 lakh need only a co-obligation of parents and no security. Loans above Rs. 7.5 lakh need collateral security for the entire loan amount. An assignment of future income is needed in both cases

Eligibility

• The borrower should be an Indian national
• As a student, you should have secured admission in a professional or technical course through Entrance Tests or a Merit-Based selection process

Eligible Courses

• Graduate, postgraduate, doctorate, professional or any other course from one of the approved premier institutes.
• The list of premier institutes and their categories as specified by Bank of Baroda can be seen here

Borrower Contribution to Total Cost (Margin Money)

• The bank does not charge any margin money on this loan

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

Processing and Other Charges

• There are no processing charges for this loan
• Bank of Baroda charges Rs. 8,500 for Advocate and Valuer fees in case a mortgage has to be created as security for its Baroda Scholar loan
• Like the above education loans, there is no charge for mortgage creation

Uses of the Loan

• The loan amount can be used to pay any fees or other charges that are a part of the standard tuition, hostel or any other institution-approved cost that are necessary to complete the course
• The loan can also be met to cover any expenses on study tours, project works, thesis and so on
• The loan can be used to pay for any insurance premium if it is opted for by the student. Currently, Bank of Baroda has tie-ups with IndiaFirst Life Insurance Kotak Life Insurance for Group Credit Life insurance cover to education loan borrowers
• Any caution or refundable deposit moneys are allowed under the loan provided that the total such amount is less than 10% of the total loan
• The loan can also be used to pay off ex-college lodging in which case the amount is paid directly to the lodging establishment after its credentials have been verified
• However, the loan cannot be used to pay for external coaching or tuition

Other Features to Know

• The loan comes with its own debit card
• The bank asks for details of expenses for the course that the applicant(s) need to obtain from the institution
• In case the programme is offered in partnership with any Technology Partner and classes are conducted in centres of these partners, then these premises will be treated on an equal footing with the institute
• During application, the borrowers should provide an affidavit that they have not taken an education loan from another bank for the same child. In case they seek another education loan from a different lender, then they will have to take an NOC from Bank of Baroda for the new loan
• The student’s progress report has to be submitted with the bank at regular intervals
• The lending branch should be near the institute, study centre of the technology partner or the place of residence of the borrower
• The loan is disbursed directly to the college, book seller or publisher, computer seller, and so on and not to the applicant(s)

Documents Needed

• Application Form duly filled and signed by applicant and/or guarantor along with details of applicant and/or guarantor and family
• 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
• Fee Details with Demand of Fee by the Institution
• All Proofs of Past Academic Record including Mark Sheets and Certificates
• An Income Certificate from a Competent Authority to avail the interest subsidy under Central Interest Subsidy Scheme of Education Loans, if eligible
• Property or other security documents wherever applicable

Reference Facts

• Bank of Baroda Website: www.bankofbaroda.com and www.bobibanking.com (net banking)
• Headquarters: Baroda (Vadodara), Gujarat
• Education Loan Number: 846 700 1122 (to give a missed call)
• Call Centre Toll-Free Number: 1800 223 344, 1800 102 4455