Looking for an Education Loan to Finance Your Technical Education?

Your search ends here. This page contains all the information you will need on Bank of India’s Pradhan Mantri Kaushal Rin Yojana (also called Skill Loan Scheme).

Bank of India’s Pradhan Mantri Kaushal Rin Yojana (Bank of India Skill Loan Scheme)

This loan helps students who have gained admission into technical courses offered by government-recognised training institutes, schools, colleges and polytechnics pay for their course fees. The loan amount starts from Rs. 5,000 and can go up to Rs. 1.5 lakh.

Features of Bank of India Skill Loan Scheme for Technical Courses

Why this Loan?

  • The loan is meant for you if you have gained admission into a technical course offered by a polytechnic, Industrial Training Institute (ITI), school, college or training institute recognised by the state or central government of India and eligible to offer the Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
  • The bank disburses the Bank of India Skill Loan Scheme as a series of payments over the required number of terms or years to pay the course fees or other approved expenses

Loan Amount

  • The minimum loan amount starts from Rs. 5,000 and the maximum amount can go up to Rs. 1.5 lakh

Interest

  • The interest rate charged will be the sum of Repo Based Lending Rate (RBLR) and strategic premium of 1.50%. As of October 2020, the RBLR of Bank of India is which is currently 6.85% which makes the effective interest rate for this loan scheme to be 8.35%
  • Interest is charged monthly during the repayment moratorium period
  • The loan offers the option to the borrower to pay the interest portion during the moratorium period. If the borrower chooses to do so, the interest rate is reduced by 1% for the tenure of the loan. No concession is applicable after the commencement of the repayment period

Repayment

  • Loans of up to Rs. 50,000: Repayment period is up to 3 years after course completion
  • Loans between Rs. 50,000 and 1 lakh: Repayment period is up to 5 years after course completion
  • Loans above Rs. 1 lakh: Repayment period is up to 7 years after course completion
  • The repayment moratorium for courses of less than 1 year is equal to the sum of the course duration and an additional grace period of 6 months after course is completed
  • The repayment moratorium for courses of over 1 year duration is equal to the sum of the course duration and an additional grace period of 12 months after course is completed

Security Needed

  • Bank of India does not ask for any collateral or third party guarantee
  • However, the parents have to sign the loan documents with the student as joint borrowers

Eligibility

  • The borrower should be an Indian national
  • In case the student is a minor, the parents will have to sign the application and do the necessary paperwork. The bank will get the student to ratify the loan through a letter of acceptance of terms and conditions once she or he reaches the age of majority

Eligible Courses

  • Courses offered by Industrial Training Institutes (ITIs), polytechnics, schools recognised for the same by the central or state education board or college affiliated to a recognised university are eligible for the loan
  • Certificate, diploma or degree course from training centres that are affiliated to professional skill augmentation bodies such as National Skill Development Corporation (NSDC), sector skill councils, state skill missions, state skill corporations and who operate under the National Skill Qualification Framework (NSQF) are eligible to apply for the loan
  • The bank allows its State Level Bankers committee (SLBC) or State level Co-ordination Committee (SLCC) to add state-specific skill development courses that offer good employability opportunities for course students

Borrower Contribution to Total Cost (Margin Money)

  • Bank of India 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

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 cost
  • The loan can also be met to cover examination, library and laboratory fees
  • It also covers any caution deposit fees
  • It can also be used to buy books or equipment or instrument needed for the course

Other Features to Know

  • The borrower can repay the loan from any time without having to pay any prepayment charges
  • Bank of India offers optional insurance cover to borrowers. The premium is recovered through EMIs
  • During application, the borrowers should provide an affidavit that they have not taken an education loan from another bank
  • The student’s progress report has to be submitted with the bank after each term or semester before availing the next instalment
  • 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 parents along with details of applicant and/or parents
  • Two Passport Size Photographs of applicant(s)
  • Photocopy of PAN Cards of the student or parents that need 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

Reference Facts

  • Bank of India Website: www.bankofindia.com and www.bankofindia.co.in
  • Headquarters: Mumbai, Maharashtra
  • Call Centre Toll-Free Number: 1800 220 229, 1800 103 1906