Andhra Bank Loan

Andhra Bank Education Loan for Higher Studies in India and Abroad Education

Since the rules, regulations, eligibility conditions, repayments and interests rates etc are revised by the banks from time to time. students and parents are advised to check thoroughly the terms and conditions of educational loan scheme of respective bank on offer at the time of application.

Andhra Bank

Educational Loans for Higher Studies in India and Abroad.

Student Eligibility :

  • The student should be an Indian National.
  • NRI-if student is holding Indian Passport. (Suitable Collateral Security enforceable in India is to be provided for all such proposals.)
  • Should have secured admission to a higher education course in recognized institutions in India or Abroad through Entrance Test/ Merit Based Selection process after completion of HSC(10 plus 2 or equivalent)/higher qualification.
  • In case where admission is not through common entrance test and the marks secured in the qualifying examination is the only criteria adopted, the minimum cut off marks should be 65% in aggregate in the qualifying academic examination.
  • Educational loans are allowed to meritorious students, who qualify in entrance examination but choose to pursue under Management quota for reasons like proximity, choice for a course of discipline or any other reasons pertaining to his academic/career interests.

Institute Eligibility :

  • List of accredited institutions for all the courses is kept in this website. Education Loans are given to students who secure admission in accredited Institutions.
  • The eligibility for loan is determined based on employability of the course and reputation of the institution concerned.

Studies in India: (Indicative list)

  • Approved courses leading to graduate/ post graduate degree and P G diplomas conducted by recognized colleges/ universities recognized by UGC/ Govt./AICTE/ AIBMS/ ICMR etc. Courses like ICWA, CA, CFA etc.
  • Courses conducted by IIMs, IITs, IISc, XLRI. NIFT,NID etc.
  • Regular Degree/Diploma courses like Aeronautical, pilot training, shipping, etc., approved by Director General of Civil Aviation/Shipping, if the course is pursued in India. Air Craft Maintenance Engg, Pre-Sea Training courses must be either a degree course recognized by a competent University or Diploma course recognized by appropriate State Govt. body to be eligible for considering loan.
  • Approved courses offered in India by reputed foreign universities.
  • Nursing Courses and Para Medical courses offered by approved institutes including admissions through management quota. The fee considered for finance is restricted to fee structure as approved by the State Government or regulatory body.
  • Any other course offered by institutes of repute with assured employment potential for the students and where the degrees/diplomas /certificates issued by such institutes have due recognition by Govt. Of India/State Govt./Academic Bodies duly constituted by State/Central Govt .
  • Off campus courses and onsite/partnership programs are not eligible for educational loans.
  • Education loans for Research work to the students with masters degree and is admitted as research scholar in Universities/Research institutes having due recognition. Education loan for Home Study/Correspondence courses with contact classes or Coaching classes will not be considered.
  • Vocational And Skill Development Courses of duration from 6 months to 3 years leading to certificate/diploma offered by recognized State/Central Govt. Institution or Statutory/Technical Body or Training Dept. of Govt. etc.

Studies abroad :

  • Graduation: For job oriented professional/ technical courses offered by reputed universities.
  • Post graduation: MCA, MBA, MS, etc.
  • Courses conducted by CIMA- London, CPA in USA etc. Degree/diploma courses like aeronautical, pilot training, shipping etc provided these are recognized by competent regulatory bodies in India/abroad for the purpose of employment in India/abroad.
  • Job oriented Diploma and certificate courses pursued abroad after completion of Graduation Course in India.
  • Diploma courses and certificate courses have not been included as eligible courses for the scheme. Post graduate studies leading to PG degrees and PG diplomas offered by reputed institutes/universities will be covered under the scheme.

Expenses considered for loan :

  • Fee payable to college/ school/ hostel
  • Examination/ Library/ Laboratory fee
  • Travel expenses/ passage money for studies abroad
  • Insurance premium for student borrower, if applicable
  • Caution deposit, Building fund/refundable deposit supported by Institution bills/receipts.
  • Purchase of books/ equipments/ instruments/ uniforms
  • Purchase of computer at reasonable cost, if required for completion of the course
  • Any other expense required to complete the course - like study tours, project work, thesis, etc
  • In respect of Degree level courses in Non Technical and Non Professional courses the aggregate of all expenses considered for finance should not exceed Rs.1 Lakh for the total course .


  • Reasonable lodging and boarding charges will be considered in proportion to the course cost incase the student chooses/ is required to opt for outside accommodation.

Quantum of Finance:

  • Need based finance to meet the expenses worked out as above will be considered taking into account margins. No specific upper limit is suggested.
  • In case of studies abroad, part cost of the study can be considered for finance as requested by the student duly taking into consideration part time jobs as permitted by the institutes to part fund the course costs.

Margin :

Upto Rs..4 lacs   Nill
Above Rs. 4 lacs Studies in India 5%
Studies Abroad 15%
  • Scholarship/ assistantship to be included in margin.
  • Margin may be brought-in on year-to-year basis as and when disbursements are made on a pro-rata basis.


Upto Rs..4 lacs Parents to be joint borrower(s).No security. Collateral free limit of Rs.4 lakh is student specific and not family specific. More than one loan can be considered for other siblings in the same family even when one of the siblings has already availed a collateral free loan.
Above Rs.4 lakh & upto Rs.7.5 lakh Besides the parent(s) executing the documents as joint borrower(s), collateral security in the form of suitable third party guarantee will be taken.
Above Rs.7.5 lakhs Parent(s) to be joint borrower(s) Tangible collateral security of suitable value acceptable to bank along with the assignment of future income of the student for payment of installments.


  • The loan documents should be executed by both the student and the parent/ guardian as joint-borrower.
  • The security can be in the form of land/ building/ Govt. securities/ Public Sector Bonds/Units of UTI, NSC, KVP, life policy, gold, and shares/mutual fund units/debentures, bank deposit in the name of student / parent / guardian / any other third party or any other tangible security acceptable to the bank with suitable margin.
  • Wherever the land/ building is already mortgaged, the unencumbered portion can be taken as security on second charge basis provided it covers the required loan amount.

Rate of Interest :

  • Interest to be charged at rates linked to the Base rate as decided by the Bank from time to time.
  • Simple interest to be charged during the study period and up to commencement of repayment.
  • 0.50% concession in spread for Girl Students.
  • Servicing of interest during study period and the moratorium period till Commencement of repayment is optional for students. Accrued interest will be compounded at the time of commencement of repayment & EMI will be fixed accordingly.

Interest rates on Educational loans:

Up To Rs. 7.50 Lakhs Base Rate+2.75%
Above Rs. 7.50 Lakhs Base Rate+1.50%
  • (0.50% concession for girl Students) and concessional interest rates to students in premier institutions @ Base Rate.

Concession in Interest Rates :

  • For Meritorious students interest concession of 50 basis points on Educational loans to students (for studies in India/Abroad/Vocational courses) securing 90% or above in aggregate/equivalent grade at 10th or 10+2 qualifying level in respect of loans for vocational /graduate level courses.
  • In respect of loans for pursuing P.G. courses, interest concession of 50 basis points is introduced to students who secured 80% or above in aggregate / equivalent grade at qualifying degree/graduation level examination.
  • Top 50 rankers in case of State level and top 100 rankers in case of National level are offered educational loans at 100 basis points lower to normal rate of interest subject to a minimum of base rate.

Premier Educational Institutes:

  • Bank as allowing Educational Loans to students who got admission to certain premier institutes at concessional interest rates and some other concessions. Given below are the list of premier Educational Institutes.
Sno. Name of the Premier Institute Nature of concessions offered
1. Indian Institute of Technology(I.I.T.) Maximum Loan Limit: Rs.20Lakh
Margin : 10%
Rate of interest:Base Rate (floating) (No further concessions for Girl Child/Merit/Staff children students).
Collateral Security : i. Up to 10 lakhs : Nil ii. Above 10 lakhs : 50% of the limit sanctioned.
Co-obligation: Up to Rs.4.00 lacs :- Parents to be joint borrowers. Above Rs.4 lacs :- Parents to be joint borrowers. Coobligation of earning parent/spouse or third party in case parent/spouse has no earnings.
2. Birla Institute of Technology and Science (BITS)
3. Indian Institute of Management (IIM)
4. Xavier Labour Relations Institute (XLRI) Jamshedpur.
5. Management Dev. Institute (MDI)-Gurgaon
6. SP Jain Institute of Management and Research (SPJJMR)- Mumbai
7. Indian Institute of Management-Ahmedabad Maximum Loan Amount : Rs.20 Lakhs
Margin : 10%
Rate of Interest: Base Rate (floating) (No further concessions for Girl Child/Merit/Staff children students).
Collateral Security :No collateral security required.
Up to Rs.4.00 lacs : Parents to be joint borrowers.
Above Rs.4.00 lacs : Parents to be joint borrowers. Coobligation of earning parent/spouse or third party in case parent/spouse has no earnings. PAN Card of the student is compulsory
8. International Institute of Information Technology, Gachibowli, Hyderabad Maximum Loan Amount :Rs.7.50 Lakhs
Margin :
Up to Rs.4.00 lakhs : Nil
Above Rs.4.00 lakhs : 10.00%
Rate of Interest:Base Rate (floating) (No further concessions for Girl Child/Merit/Staff children students).
Collateral Security :No collateral security required.
Up to Rs.4.00 lacs :Parents to be joint borrowers.
Up to Rs.4.00 lacs :Parents to be joint borrowers. Coobligation of earning parent/spouse or third party in case parent/spouse has no earnings. PAN Card of the student is compulsory.
9. Institute of Mgt. Technology (IMT) Maximum Loan Amount :Rs.20.00 Lakhs
Margin : 10.00%
Rate of Interest:
Base Rate +1.25% for Male students
Base Rate+0.75% for female students
(No further concessions for Girl Child/Merit/Staff children students).
Collateral Security :Not less than 50% of the limit sanctioned.
Co-obligation:Coobligation of earning parent/spouse.
10. Somaiya Instt. Of Mgt. Studies and Research.
11. Jaman Lal Bajaj Instt. Of Mgt. Studies (JBIMS)
12 Netaji Subash Instt. Of Technology (formerly Delhi university of Technology) NSIT Maximum Loan Limit:Rs.3.80 Lakhs
Margin :Nil
Rate of interest:
Base Rate +1.25% for Male students
Base Rate+0.75% for female students
(No further concessions for Girl Child/Merit/Staff children students).
13 Indian School of Business (ISB), Hyderabad and Mohali Maximum Loan Limit:Rs.25 lakhs
Margin : 5%
Rate of interest:Base Rate (floating) (No further concessions for Girl Child/Merit/Staff children students).
Collateral Security: No collateral security required.

Appraisal / sanction/ disbursement:

  • Applications will be received either directly at bank branches or through on-line mode.
  • Sanction/rejection will be communicated within 15 days of receipt of duly completed application along with supporting documents.
  • In the normal course, while appraising the loan, the future earning potential of the course to the student and the percentage of income available for repayment only will be looked into.
  • Rejection of loan application, if any, shall be done with the concurrence of the controlling authority of the branch concerned and conveyed to the student stating reason for rejection.
  • Applications for Educational Loans from eligible student can be accepted either at the Bank branch near the residence of parents or to the educational institution.
  • Service area approach is not adopted while sanctioning Education Loans.

Repayment :

  • Repayment Holiday/Moratorium: Course period + 1 year or 6 months after getting job, whichever is earlier.
  • If a student takes up higher studies immediately upon completion of the course, the commencement of repayment would get shifted to 6 months from employment or one year from completion of the second course whichever is earlier. This would be so irrespective of whether the student had taken fresh/top up loan for higher studies or not.
  • No penalty will be levied for prepayment of loan.

Insurance :

  • Bank may, with the consent of the student, arrange for life insurance/liability insurance policy for the students availing Education Loan, but not mandatory.

Minimum Age :

  • There is no specific restriction with regard to the age of the student to be eligible for education loan.

Central scheme for interest Subsidy: Benefits of the scheme :
1.Central Scheme to provide Interest subsidy (CSIS):

  • In order to support students from economically weaker sections of the society, Government of India has launched the interest subsidy scheme to provide full interest subsidy during the period of moratorium i.e., course period plus one year or six months after getting job, whichever is earlier, on loans taken by students belonging to Economically Weaker Sections from scheduled banks under the Educational loan scheme.
  • The interest subsidy scheme would be applicable to those students belonging to economically weaker sections (EWS) with an annual gross parental / family income up to Rs. 4.50 lakhs per year (from all sources). Income proof shall be required from public authorities who are competent to issue income certificates & authorized by the State Governments for certification of income status for this scheme.
  • The interest subsidy under the scheme shall be available to the eligible students only once, either for the first undergraduate degree course or the post graduate degree / diplomas in India. Interest subsidy shall however be admissible for integrated courses (graduate + post graduate).
  • Interest subsidy under the scheme shall not be available for those students once they discontinue the course midstream, or who are expelled from the institutions on disciplinary or academic grounds.
  • Interest subsidy claims shall be on yearly basis, as decided by the Ministry of HRD, Government of India.

2.Income tax :

  • Interest charged to the Educational loan account and paid is exempted from tax to the parent of the student as per IT Rules.

Expenses considered for loan :

  • Tuition /Course fixed by Govt/Authorities appointed by Govt.
  • Examination/ Library/ Laboratory fee
  • Caution deposit.
  • Purchase of books/ equipments/ instruments
  • Any other expense required to complete the course.
  • In respect of course fee of Private Institutions, the expenses will be limited to 125% of the fees prescribed by the Govt. for similar courses, if such fees is not fixed by Govt/Authorities appointed by Govt.

Quantum of Finance:

  • Need based finance to meet the expenses worked out as above will be considered subject to the following ceilings. No Margin from the borrower.
  • 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/-
  • In respect of courses offered by reputed institutions having regard to the nature of such courses and employability, ability to repay out of job earnings, the ceilings may be relaxed to Rs.2 Lakh for courses of duration above 1 year.

Repayment Term:

  • For Loans upto to Rs.50000/- Repayment Term upto 2 years.
  • For Loans from Rs.50,000 to Rs.1.00 lakh 2 to 5 years.
  • For Loans above Rs.1,00,000 3 to 7 years.

Other Terms and Conditions:

  • Other terms and conditions as applicable to the Model Educational Loan Scheme for Pursuing Higher Education in India and Abroad are applicable to this scheme also.


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