Description

Bank of Baroda, India’s second-biggest bank in terms of assets is an Indian state-owned international banking and financial services institution headquartered in Vadodara, Gujarat with its corporate office in Mumbai. Bank of Baroda was nationalized in 1969, by the government of India and has been assigned as profit-making public sector undertaking (PSU). The bank has over 5538 branches and 10,441 ATM’s across India and abroad. It has merged with and taken over a few smaller banks of the country too. Bank of Baroda provides a wide range of banking products and financial services to corporate and retail customers

Bank of Baroda Education Loan.

Education is the one of the most essential investments any individual makes in his life. However, with increasing cost of education, it has become commonplace to take out an education loan.

Bank of Baroda had modest initial stages, but now it is one of the largest banks in India. It was started in a small building in Baroda. Today, it is present all-over India & abroad. Bank of Baroda offers customized education loan schemes to meet your requirements. Whether you are planning school education of your child, pursuing a graduate or post-graduate degree, the Bank of Baroda Education Loans can help finance your ambitions and goals.

What Is an Education Loan?

An Education loan is the advance or funds acquired by a student to pursue higher studies in India or abroad. The repayment of the loan commences for the candidate after completing the education and a period of 6 months or 1 year which is given as grace period for students to get a job. The grace period is also called Moratorium period.

The repayment amount to be paid depends upon you. That is if you want to start paying during the time of moratorium period itself or after it. It is only after this time that you are expected to pay the loan.

Bank of Baroda Education loan schemes

  1. Baroda Vidya
  2. Baroda Gyan
  3. Baroda Scholar

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1) Baroda Vidya

The Loan under this scheme will be sanctioned for extending financial assistance to deserving & meritorious students for pursuing education. Bank of Baroda presents a unique finance option for parents of students pursuing school education. These loans are available for studies from Nursery to Senior Secondary School.

  • No processing & documentation charges.
  • No Margin.
  • No security required.

Eligibility for Baroda vidya scheme

  • Should be an Indian national residing in India.
  • The student should have secured admission to a recognized school / High school / Jr. College (including CBSE / ICSE / State Board) for any of the following courses
  • Stage I: Nursery to Vth STD.
  • Stage II: VIth to VIII STD.
  • Stage III: IXth to XIIth STD.

Coverage of expenses for:

  • Fee payable to college/school.
  • Examination / Library / Laboratory Fee.
  • Fee and other charges payable to the hostel.
  • Purchase of books / equipments / instruments / uniforms.
  • Personal Computers / Laptops wherever required.
  • Caution deposit / building fund / refundable deposit supported by institution bills / receipts.
  • Maximum Loan Amount: Rs.4.00 lacs

Repayment Period:

  • Loan for each yearly sub limit is repayable in 12 equal monthly installments. First installment to be due 12 months after first disbursement of each year's loan component.
  • Interest to be serviced as and when applied during the moratorium period.

Security:

  • In case the loan is given for the purchase of a computer the same needs  to be hypothecated to the bank.

Rate of Interest as in June 2018

  • One year MCLR + Strategic Premium + 2.50% = 10.95% P.A
  • 0.5% concession in the rate of interest to loans for girl students

2) Baroda Gyan

A loan product specially designed for students pursuing Graduation, Post - Graduation, Doctorial, Professional & Other courses in India. Bank of Baroda extends a helping hand to energize your studies and promote the education of the youth.

  • No processing charges.
  • No Margin on loans up to 4 lacs.
  • Free Debit Card.
  1. Courses Eligible:
    • All graduation courses
    • All Post Graduation courses & Doctorate courses
    • Professional Courses viz. Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Computer, Ayurved, Homeopathy, Physiotherapy, Hotel Management, Hospital Management, Interior Designing, Architecture, Event Management, Mass Communication, Fashion Technology, etc.
    • Computer certificate courses of reputed institutes accredited to Dept. of Electronics or institutes affiliated to Universities.
    • Courses like C.A, ICWA, CFA, CS, etc.
    • Courses conducted by IIM, IIT, IISc, XLRI. NIFT etc.
    • Regular Degree/ Diploma courses like Aeronautical, pilot training, shipping etc., approved by Director General of Civil Aviation/shipping.
    • Other courses leading to diploma/degree etc. conducted by colleges/universities approved by UGC/Govt./ AICTE/ AIBMS/ ICMR etc
    • Courses offered in India by reputed foreign Universities.
    • Evening courses of institutes approved by State/Central/Govt./UGC/AICTE/AIBMS/ICMR/ICAR.
    • Courses offered by National Institutes and other reputed private institutions. The College/Institute must have been approved by the State/Central Govt./UGC/AICTE etc.
  2. Student Eligibility:
    • Should be an Indian national
    • Should have secured admission to either of above courses
    • A meritorious student (who qualifies for a seat under merit quota) will also be eligible for a loan under this scheme even if the student chooses to pursue a course under Management Quota.
    • Or courses under Management Quota Seats under the scheme. Fees as approved by the State Government/ Government approved regulatory body for payment seats will be considered, subject to the viability of repayment.
    • Additional concession of 1.00% to the students who have sought admission in premier institutions viz. IIMs, IITs and AIIMS / AFMC for loans of more than Rs 7.50 lac secured by tangible securities
  3. Coverage of expenses:
    • Fee payable to college / Institution / University
    • Examination / Library / Laboratory Fee
    • Fee and other charges payable to hostel
    • Purchase of books / equipments / instruments.
    • Personal Computers / Laptops wherever required.
    • Caution deposit / building fund / refundable deposit supported by institution bills / receipts.
    • Any other expenses required to complete the course - like study tours, project works, thesis, etc.
  4. Quantum of finance:
    • A maximum Rs.80.00 Lacs for Medical & Aviation Education and
    • A maximum Rs.10.00 Lacs for others.
    • Need based finance subject to repayment capacity of parents.
  5. Margin:
    • Up to Rs. 4.00 lacs:- NIL
    • Above Rs. 4.00 lacs: - 5%
  6. Repayment Holiday / Moratorium Period:
    • Course period + 1 year or 6 months after getting a job, whichever is earlier?
  7. Repayment Period:
    • Repayable in 120 maximum Installments for loan amount up to Rs 7.50 Lacs
    • Repayable in 180 maximum Installments for loan amount above Rs 7.50 Lacs.
  8. Security:
    • Up to Rs.4 lacs: No security
    • Above Rs. 4.00 Lacs and up to Rs. 7.5 lacs: Collateral in the form of a suitable third party guarantee along with assignment of future income.
    • Above Rs.7.5 lacs: Tangible collateral security equal to 100% of the loan amount along with assignment of future income of the student for payment of installments

The rate of Interest as in June 2018.

  • Effective rate of interest 10.45% P.A
  • Simple interest to be charged at monthly rests during the repayment holiday/moratorium period.
  • 1% interest concession is provided if interest is debited during repayment holiday. 0.5% Concession in rate of interest to loans for girl student.
  • Penal interest @ 2% p.a. on overdue amount, if the loan amount exceeds Rs.4.00 Lacs.

3) Baroda Scholar

Bank of Baroda presents financial supports to students going abroad for Professional / Technical studies. The loan offering is designed to empower you with the financial capability to realize your dreams.

  • Eligibility of Courses:
    • Graduate/Post Graduate/Doctorate/Job Oriented Professional /Technical Courses offered by reputed Universities overseas.
    • Regular Degree/Diploma courses like Aeronautical, pilot training, shipping etc. The Institute should be recognized by the competent local aviation/shipping authority and Director General of Civil Aviation/shipping in India.
  • Student Eligibility:
    • Should be an Indian National.
    • Secured admission to Professional/Technical Courses at foreign Universities/Institutions.
  • Coverage of expenses (for overseas studies):
    • Admission/Tuition fees to College/University.
    • Hostel/Mess charges.
    • Examination/Library/Laboratory fee.
    • Purchase of books/ equipment/instruments.
    • Caution deposit/building fund/refundable deposit supported by Institution bills/receipts.
    • One way travel expenses/Passage money.
    • Purchase of computers if essential for completion of the course.
    • Any other expense required to complete the course e.g. study tour, project work, thesis etc.
  • Maximum amount of loan: Rs. 80.00 Lacs.
  • Margin:
  • For Institutions specified in List of Premier Institutions: NIL (irrespective of the loan amount)
  • Institutions not specified in List of Premier Institutions
    • Up to RS.4.00 lakh: NIL
    • Above RS.4.00 lakh:10%
  • Repayment Holiday / Moratorium Period:
    • Course period + 1 year or 6 months after getting a job, whichever is earlier.
  • Repayment Period:
    • Repayable in 120 maximum Installments for loan amount up to Rs 7.50 Lacs.
    • Repayable in 180 maximum Installments for loan amount above Rs 7.50 Lacs.
  • Security:
    • Up to Rs.4.00/- lacs: No security
    • Above Rs. 4.00 Lacs and up to Rs. 7.5 lacs: Collateral in the form of a suitable third party guarantee along with assignment of future income of the student for payment of Installment.
    • Above Rs.7.5 lacs: Tangible collateral security equal to 100% of the loan amount along with assignment of future income of the student for payment of installments.
  • Rate of Interest as in June 2018
    • Effective rate of interest 9.7% P.A
    • Simple interest during repayment holiday/moratorium period.
    • 0.50% Concession in rate of interest to loans for girl student.
    • Penal interest @ 2% p.a. on overdue amount if loan exceeds Rs.4/- lacs.
  • Insurance:
    • Group credit Life Insurance Cover will be available at the option and cost of the borrower. Cost of Insurance Premium may be financed by Bank by adding the same in the project cost and shall be recovered along with EMIs of the loan.
    • The Borrower can repay the loan any time after commencement of repayment WITHOUT having to pay any prepayment charges.

Documents Required

Bank of Baroda education loan documents required

  • Letter of admission
  • Filled in Loan Application Form
  • 2 passport size photographs
  • Statement of cost of study
  • PAN Card of the student and Parent/ Guardian
  • AADHAR Card of the student and Parent/ Guardian
  • Proof of identity (Driving Licence/Passport/Aadhar/ any photo identity)
  • Proof of residence (Driving Licence/Passport/Electricity bill/Telephone bill)
  • Student/Co-borrower/ guarantor's bank account statement for last 6 months
  • IT return/ IT assessment order, of previous 2 years of Parent/ Guardian/ other co-borrower (if IT Payee)
  • A brief statement of assets & liabilities of Parent/ Guardian/ other co-borrower
  • Proof of income (i.e. salary slips/ Form 16) Parent/ Guardian/ other co-borrower

Documents Required

Bank of Baroda education loan documents required

  • Letter of admission
  • Filled in Loan Application Form
  • 2 passport size photographs
  • Statement of cost of study
  • PAN Card of the student and Parent/ Guardian
  • AADHAR Card of the student and Parent/ Guardian
  • Proof of identity (Driving Licence/Passport/Aadhar/ any photo identity)
  • Proof of residence (Driving Licence/Passport/Electricity bill/Telephone bill)
  • Student/Co-borrower/ guarantor's bank account statement for last 6 months
  • IT return/ IT assessment order, of previous 2 years of Parent/ Guardian/ other co-borrower (if IT Payee)
  • A brief statement of assets & liabilities of Parent/ Guardian/ other co-borrower
  • Proof of income (i.e. salary slips/ Form 16) Parent/ Guardian/ other co-borrower

FAQs

Query- How will the bank track the educational progress of the borrower/ student?

Reply- The borrower is expected to submit his/her progress reports to the bank regularly, for record keeping purposes.

Query- Is the student’s boarding and lodging covered in the subscribed education loan?

Reply- In cases where  the student doesn’t secure the hostel facility as offered by the concerned educational institution, he/she can seek to stay elsewhere. After confirming the authenticity of the concerned place, the bank shall directly remit the applicable expenses to the boarding and lodging facility.

Query- What is the meaning of ‘Margin’ in the context of education loans?

Reply-. The margin is the amount you need to pay from your own funds, while the rest is paid by the lending institution. If you need, say, a loan of Rs 1 Lacs and the bank is ready to finance 80 per cent (Rs 80,000) of the loan amount then you will have to make arrangements for the remaining 20 per cent i.e (Rs 20,000). In this case, Rs 20,000 is the margin amount.

Query- What is the interest charged during a moratorium period?

Reply- Only simple interest will be charged during the moratorium period. After the moratorium period, the actual interest mentioned will be charged.

Query- Can I take an education loan without a co-borrower?

Reply- No, a co-borrower is needed to take an education loan. The loan will be taken as a joint loan in collaboration with your parent/ guardian or spouse.

Query- I am planning to study abroad. Am I eligible to apply for an Education Loan?

Reply- Yes, Bank of Baroda offers up to INR 80 Lakhs for courses pursued abroad which also includes travel expenses and study tours.

Query- Is there a processing fee for an education loan with Bank of Baroda?

Reply- No, there are no processing fees on Bank of Baroda Vidya & Gyan education loan schemes. However, for the Scholar scheme, 1% of the loan amount will be charged as processing fee.

Query- Is there a way I can reduce the interest paid?

Reply- There is special subsidy provided by the Central Government for education loans. Bank of Baroda also provides special interest rates for some premier institutions. The other option is that ,your parent/ guardian or spouse can pay the loan amount during the moratorium period due to which the loan amount you need to repay becomes less.