Jammu & Kashmir Bank Education Loan for Higher Studies in India and Abroad
This Jammu & Kashmir Bank study loan helps students finance their education and realise their dreams of pursuing higher education at recognised educational institutions in India or abroad. The maximum loan amount you can get is Rs. 10 lakh for studying in India and Rs. 30 lakh for studying abroad.
Features of Jammu & Kashmir Bank IBA Model Education Loan
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 Jammu & Kashmir Bank Education loan is disbursed as a series of payments over the required number of years and not as a lump sum
- The loan can be taken for all expenses directly related to the course including for fees, purchase of books, laptops, hostel fees, lab fees, examination fees, etc.
Loan Amount
- The maximum loan amount you can get is Rs. 10 lakh for studying India and Rs. 30 lakh for studying abroad
Interest
- Loans up to Rs. 10 Lakh: Loans of less than 5 years have a fixed interest rate which is the sum of Repo Linked Lending Rate (RLLR) and 2.00%. Loans above 5 years have an interest rate of RLLR and 1.50%. As the RLLR as of November 2020 is 7.60%, this makes the interest rates 9.60% and 9.10% respectively
- Loans from Rs. 10 Lakh to Rs. 20 Lakh: Loans of less than 5 years have a fixed interest rate which is the sum of Repo Linked Lending Rate (RLLR) and 3.00%. Loans above 5 years have an interest rate of RLLR and 2.25%. As the RLLR as of November 2020 is 7.60%, this makes the interest rates 10.60% and 9.85% respectively
- Loans Above Rs. 20 Lakh: Loans of less than 5 years have a fixed interest rate which is the sum of Repo Linked Lending Rate (RLLR) and 3.50%. Loans above 5 years have an interest rate of RLLR and 2.75%. As the RLLR as of November 2020 is 7.60%, this makes the interest rates 11.10% and 10.35% respectively
- Earlier the interest rates were as below:
- Loans up to Rs. 7.5 lakh Covered Under CGFSEL: The interest rate for this quantum of loan is MCLR + 2.00% where MCLR is Marginal Cost of Funds-Based Lending Rate (MCLR). As of October 2020, the MCLR of Jammu & Kashmir Bank is 7.50% which brings the effective interest rate for this loan at 9.50%
- Loans up to Rs. 7.5 lakh Not Covered Under CGFSEL: The interest rate for this quantum of loan is MCLR + 1.50% where MCLR is Marginal Cost of Funds-Based Lending Rate (MCLR). As of October 2020, the MCLR of Jammu & Kashmir Bank is 7.50% which brings the effective interest rate for this loan at 9.00%
- Loans from Rs. 7.5 lakh up to Rs. 10 lakh: The interest rate for this quantum of loan is MCLR + 1.50% where MCLR is Marginal Cost of Funds-Based Lending Rate (MCLR). As of October 2020, the MCLR of Jammu & Kashmir Bank is 7.50% which brings the effective interest rate for this loan at 9.00%
- Loans from Rs. 10 lakh up to Rs. 20 lakh: The fixed interest rate for this quantum of loan is MCLR + 2.50%. As of October 2020, the MCLR of Jammu & Kashmir Bank is 7.50% which brings the effective interest rate for this loan at 10.00%. The floating interest rate is calculated as MCLR + 2.25%. As of October 2020, the MCLR of Jammu & Kashmir Bank is 7.50% which brings the effective interest rate for this loan at 9.75%
- Loans Above Rs. 20 lakh: The fixed interest rate for this quantum of loan is MCLR + 3.00%. As of October 2020, the MCLR of Jammu & Kashmir Bank is 7.50% which brings the effective interest rate for this loan at 10.50%. The floating interest rate is calculated as MCLR + 2.75%. As of October 2020, the MCLR of Jammu & Kashmir Bank is 7.50% which brings the effective interest rate for this loan at 10.25%
- Girl students get a concession in interest of 0.50% for all loans
- Fixed interest rate is only offered for education loans of tenure up to 5 years
Repayment
- The overall loan tenure is 15 years including course time, moratorium and repayment period
- The loan amount for each year is repayable in 12 EMIs, with the first instalment becoming due after the end of moratorium period
- The moratorium period for this loan is course duration + 12 months
Security Needed
- Loans up to Rs. 4 lakh: Parent or guardian must be a joint borrower. No security required
- Loans Above Rs. 4 lakh to Rs. 7.5 lakh Covered under CGFSEL: Parent or guardian must be a joint borrower. No security required
- Loans Above Rs. 4 lakh to Rs. 7.5 lakh Not Covered under CGFSEL: Parent or guardian must be a joint borrower. A third-party guarantee of two persons is required
- Loans Above Rs. 7.5 lakh: Parent or guardian must be a joint borrower. Tangible collateral more than or equal to 75% of total loan and interest due is needed. Assignment of future income of the student is mandatory to get this loan
Eligibility
- The applicant must be an Indian national
- The student should have gained admission into a recognised higher education course in a recognised institution in India or abroad through Entrance Test or Merit-based Selection process
Eligible Courses
- Graduate or Postgraduate (PG) degree or PG diploma courses from colleges and universities approved by the government, UGC, AICTE, AIBMS, ICMR, etc.
- Job-oriented technical or professional courses from reputed universities in India or abroad
- Technical diploma courses of usually 3 years offered by approved polytechnic institutions after Class 10
- Degree and Diploma courses in aviation and shipping approved by the Director General of Civil Aviation or Director General of Shipping
- Courses in India from foreign universities
- MCA, MBA, MS, etc. or other approved postgraduate diploma courses abroad
- Professional courses from CIMA-London, CPA in the USA, etc.
Borrower Contribution to Total Cost (Margin Money)
- Loan upto 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.
Processing and Other Charges
- No processing charges need to be paid for studying in India
- For studying abroad, a refundable processing fee of 1% of total loan amount up to a maximum of Rs. 5,000 must be paid
- The bank charges a penalty of 0.25% of the outstanding loan amount as pre-payment charges for the loan for repayment before the start of the repayment period
Uses of the Loan
- College, school and hostel fees
- Examination, library and laboratory fees
- Caution deposit, building fund or refundable deposit supported by institution bills or receipts
- Cost of books, equipment, instruments, uniforms
- Purchase of computer, if required for the course
- Travel expenses including passage money for foreign studies
- Insurance premium for the borrower student, if applicable
- Other expenses needed for completing the course such as study tours, project work, thesis, etc.
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, bookseller or publisher, computer seller, and so on and not to the applicant(s)
- The applicant must pay applicable margin money upfront for each disbursement
- The student’s life insurance equivalent to the loan amount is mandatory for this loan
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 or other 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
Reference Facts:
- Jammu & Kashmir Bank Website: www.jkbank.com
- Headquarters: Srinagar, Jammu & Kashmir
- Call Centre Toll-Free Number: 1800 1800 234