Looking for an Education Loan to Finance Your Technical Education in India?

Look no further. This page contains sumarises the information you will need on Indian Overseas Bank’s Skill Loan Scheme for technical courses.

Indian Overseas Bank Skill Loan Scheme

This loan from Indian Overseas Bank (IOB) helps students who have secured admission into technical courses offered by training institutes, polytechnics, schools or colleges approved by the state or central government for technical education to pay for their course fees. The loan amount starts from Rs. 5,000 and can go up to Rs. 1.5 lakh depending on the duration of the course.

Features of IOB Skill Loan Scheme for Technical Courses

Why this Loan?

  • The loan is meant for you if you have gained admission into a programme offered by a polytechnic, Industrial Training Institute (ITI), school, college etc. in India offering technical courses
  • The bank disburses the Skill Loan Scheme amount as a series of payments over the required number of terms or years to pay the course fees or other approved charges
  • There is no minimum course duration

Loan Amount

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


  • As of October 2020, the effective rate of interest for Indian Overseas Bank’s Skill Loan Scheme is 8.55%. It is the sum of the Repo Linked Lending Rate (RLLR) of 6.85% and a spread of 1.7%
  • You can check the latest interest rate from the Indian Overseas Bank website


  • 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


  • Courses up to 1 Year Duration: The repayment moratorium for courses of less than 1 year is for the course duration and an additional grace period of 6 months after date of completion of the course
  • Courses Over 1 Year Duration: The repayment moratorium for courses of over 1 year duration is for the course duration and an additional grace period of 12 months after date of completion of the course

Note: Moratorium is a time period during a loan term when the borrower is not required to make any repayment towards the loan.

Security Needed

  • No security needed but parents need to be joint borrowers. Assignment of the future income of the student may be needed for this skill loan
  • Indian Overseas Bank Skill Loan is covered under the Credit Guarantee Fund Scheme for Skill Development by NCGTC


  • The borrower should be an Indian national
  • The student must have secured admission in a technical course run by polytechnics, ITIs, training institutions aligned to National Skill Qualification Framework (NSQF)

Eligible Courses

  • Indian Overseas Bank offers Skill Loan for all technical courses run by polytechnics, ITIs, schools, colleges and institutions that are aligned with the NSQF

Borrower Contribution to Total Cost (Margin Money)

  • IOB does not charge any margin money on this loan

Note: Margin money refers to the amount the borrower contributes to the overall amount required. Suppose a course costs Rs. 1.5 lakh in which case if the borrower has to provide a margin of say 10%, then she will contribute Rs. 15,000 (10% of Rs. 1.5 lakh) to the total course fees while the lender bank offers the rest.

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 required to successfully complete the course
  • 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 bank may ask for the student’s progress report at regular intervals
  • 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

  • Indian Overseas Bank Website: www.iob.in and www.iobnet.co.in (net banking)
  • Headquarters: Chennai, Tamil Nadu
  • Education Loan Number: 044-28519490, 044-28519639
  • Call Centre Toll-Free Number: 1800 425 4445

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