1. ELIGIBILITY CRITERIA
1.1 Student Eligibility
– The student should be an Indian National
– Have secured admission in a course run or supported by a Ministry / Dept./ Organisation of the Govt. or a company / society / organization supported by National Skill Development Corporation or State Skill Missions / State Skill Corporations, preferably leading to a certificate / diploma / degree, etc. issued by a Govt. organization or an organization recognized / authorized by the Govt. to do so.
1.2 Courses Eligible
Vocational / Skill development courses of duration from 2 months to 3 years run or supported by a Ministry / Dept. / Organisation of the Govt. or a company / society / organization supported by National Skill Development Corporation or State Skill Missions / State Skill Corporations, preferably leading to a certificate / diploma / degree, etc. issued by a Govt. organization or an organization recognized / authorized by the Govt. to do so. . State Level Bankers Committee (SLBC) / State Level Coordination Committee (SLCC) may add other skill development courses / programmes, having good employability.
1.3 Minimum Age
There is no specific restriction with regard to the age of the student to be eligible for the loan. However, if the student was a minor, while the parent executes documents for the loan, the bank will obtain a letter of ratification from him / her upon attaining majority.
2. QUANTUM OF FINANCE
Need based finance to meet expenses as worked out under para 6 below will be considered subject to the following ceilings :
– For courses of duration upto 3 months Rs 20,000/-
– For courses of duration 3 to 6 months Rs 50,000/
– for courses of duration 6 months to 1 year Rs 75,000/-
– for courses of duration above 1 year Rs 1,50,000/-
Banks may consider sanction of higher limits for courses of duration above one year, if required, for specific courses offered by reputed institutions having regard to the nature of such courses and employability (ability to repay out of job earnings).
3. EXPENSES CONSIDERED FOR LOAN
1. Tuition / course fee
2. Examination / Library / Laboratory fee
3. Caution deposit
4. Purchase of books, equipments and instruments
5. Any other reasonable expenditure found necessary for completion of the course. (As such courses are localized boarding, lodging may not be necessary. However, wherever it has been found necessary, the same could be considered on merits)
5. RATE OF INTEREST
Interest rate to be charged linked to the base rate of banks as decided by the individual banks or at reduced rate, if an interest subsidy is provided by the Central / State Govt. to all or a class of beneficiaries proposed to be targeted. Simple Interest will be charged during the study period and upto commencement of repayment.
• Servicing of interest during study period and the moratorium period till commencement of repayment is optional for students.
• 1% interest concession may be provided by the bank, if interest is serviced during the study period and subsequent moratorium period prior to commencement of repayment.
6. PROCESSING CHARGES
No collateral or third party guarantee will be taken. However, the parent will execute loan document along with the student borrower as joint borrower.
8. MORATORIUM PERIOD
Upon completion of the course, repayment will start after a moratorium period as indicated below :
– for courses of duration upto 1 year- 6 months from the completion of the course.
– for courses of duration above 1 year- 12 months from the completion of the course.
The loan will be repaid after the moratorium period as indicated in para 11 in Equated Monthly Instalments (EMIs) as follows :
– courses upto 1 year – In 2 to 5 years
– courses above 1 year – In 3 to 7 years
Optional at the requirement of the borrower.
The borrower can repay the loan any time after commencement of repayment before having to pay any prepayment charges.
12.OTHER TERMS & CONDITIONS
Other terms and conditions as applicable to the “IBA Model Educational Loan Scheme for pursuing higher education in India & Abroad” will be applicable to this scheme also.