Tamilnad Mercantile Bank Education Loan for Higher Studies

Tamilnad Mercantile Bank Education Loan (for Higher Studies in India and Abroad)

This Tamilnad Mercantile 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. 20 lakh for studying abroad.

Features of Tamilnad Mercantile Bank 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 Tamilnad Mercantile 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 in India and Rs. 20 lakh for studying abroad

Interest

• The effective interest rate for the Tamilnad Mercantile Bank Education Loan ranges from 10.65% to 10.90% as of November 2020
• The interest rates are the sum of the Marginal Cost of Funds Based Lending Rate (MCLR) which as of November 2020 stands at 8.65% and a spread range of 2.00% to 2.25%

Repayment

• The maximum repayment period for this loan is 15 years
• The loan amount for each year is repayable in 12 EMIs
• The moratorium period for this loan is course duration plus 12 months or course duration plus 6 months after landing a job, whichever is earlier

Security Needed

• Loans up to Rs. 7.5 lakh: No security. Parents must be co-applicants for this education loan. These loans are covered under Credit Guarantee Fund Scheme for Education Loans
• Loans above Rs. 7.5 lakh: Parents must be co-applicants. A tangible collateral equivalent to the loan amount is also mandatory. The bank also asks for assignment of future income of the student

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

• Degree and diploma courses from colleges and universities approved by the government, UGC, AICTE, AIBMS, ICMR, etc.
• Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Architecture, Computer, etc. courses
• Hotel or Hospitality Management, Event Management, Mass Communication, etc. courses
• Degree and diploma courses in aviation and shipping approved by the Director General of Civil Aviation or Director General of Shipping
• Courses from IIM, IIT, IISc, XLRI, NIFT, NID, etc.
• Study programmes that lead to CWA, CA, CS, CFA, etc. accreditations
• Computer certificate courses from accredited institutes
• Specific postgraduate courses or research programmes eligible due to enhancement of job-opportunities and on the basis of the reputation of the institute
• B.Ed. or Teachers and nursing courses offered by approved institutions and which lead to a degree or diploma and not a certificate

Borrower Contribution to Total Cost (Margin Money)

• Loans of Rs. 4 lakh or Less: No margin money is needed for a loan of Rs. 4 lakh or below
• Loans above Rs. 4 lakh: Loans above Rs. 4 lakh need a margin money contribution of 5% for studying in India. For students who want to study abroad, the bank charges 15% as margin money
• Loans eligible under Credit Guarantee Scheme up to Rs. 7.5 lakh: No margin is needed

Note: Margin money refers to the amount the borrower contributes to the overall amount required. Suppose a course costs Rs. 10 lakh and the borrower has to contribute 10% as margin, then she will pay Rs. 1 lakh (10% of Rs. 10 lakh). The bank will cover the rest.

Processing and Other Charges

• No processing charges are levied by the bank for students who want to study in India
• For studying abroad, borrowers need to pay a charge of 1.0% of the total loan amount

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

• All loans up to Rs. 7.5 lakh are covered under Credit Guarantee Fund Scheme for Education Loans
• 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)

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/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:

• Tamilnad Mercantile Bank Website: www.tmb.in
• Headquarters: Tuticorin, Tamil Nadu
• Customer Care Toll-Free Number: 1800 425 0426