The department of Financial service (Ministry of Finance), Department of Higher Education (Ministry of Human Resources Development and Indian Banks Association (IBA) developed a portal “Vidya Lakshmi” for students looking for education loans.
NSDL E-governance infrastructures Limited is the company that has developed this portal and further is maintaining it.
The main features of the University Grants Commission Education Loan scheme:-
- This scheme provides loans up to Rs 7.5 lakh for studying in India and for studying in abroad, it is up to Rs 15 lakh.
- There is no collateral or margin money is required for loans up to Rs. 4 lakh and interest rate is same as Prime lending rate (PLR).
3. For loans above Rs 4 lakh, the interest rate will not exceed PLR plus 1%.
4. Repayment period of the loan under this scheme is 5 to 7 years with a grace period of one year after completion of your studies.
Tax Benefit under University Grants Commission Education Loan scheme:-
Tax benefits are also available on education loans taken for higher education, full-time courses in any graduate or post-graduate, professional courses, and applied science courses.
Repayment of an education loan is deductible under section 80 E of the income tax act.
The yearly limit for deduction is Rs 40,000/- including both principal and interest amounts.
This tax benefit will be available for a maximum of eight years. This period starts from the day when you start repaying your education loan.
All commercial banks are following the guidelines of the Reserve Bank of India (RBI) and have launched educational loan schemes.
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