SBI Interest Subsidy on Education Loans
The HRD Ministry of India launched the SBI Central Scheme for Interest Subsidy (CSIS) on Education Loans to pay interest on student loans for members of the Economically Weaker Section of society while they are pursuing professional and technical degrees and during the repayment vacation or moratorium period.
SBI offers an interest subsidy on education loans for students from economically weaker sections, helping reduce the financial burden on borrowers pursuing higher education in India. Read more details below.
Features of SBI Interest Subsidy Scheme
The following are the significant features of Central Scheme for Interest Subsidy:
- Applicable for technical or professional courses in India.
- During the moratorium period, the Government of India will pay the interest on the student loan.
- The student is still required to pay interest on the remaining loan debt after the moratorium period.
- Scheme is available for students whose parents have an annual gross income of Rs.4.5 lakh.
- The State Government Income Certifying Authority's income certificates must be presented by students.
- Income certificates shall be issued by the competent authority or authorities designated by the state government, in accordance with the economic index.
- Scheme will be implemented through Canara Bank.
- Interest subsidy claim will be disbursed on half-yearly or yearly basis.
Eligibility Criteria for SBI Interest Subsidy Scheme
The following are the eligibility criteria to avail the SBI interest subsidy scheme on education loan:
- Available only once for undergraduate and postgraduate or diploma courses in India.
- Applicable for integrated courses.
- Applicable only for eligible students who discontinued course on medical grounds.
Moratorium Period under SBI Interest Subsidy Scheme
This program provides educational loan subsidies for a moratorium period of either 12 months after the course ends or 6 months after the borrower's employment, whichever comes first, in accordance with the IBA Model Education Loan Scheme.
In compliance with the Education Loan Subsidy Scheme, the student must pay interest on the remaining loan amount once the moratorium period has passed.
Issuing Authority for Income Certificate
The Indian government has made it mandatory to appoint an effective authority or bodies to ensure that income certificates are issued in accordance with the economic index.
These organisations might not be required to provide income certificates, depending on the applicants' socioeconomic circumstances.
How to Apply for SBI Education Loan Interest Subsidy
Students who qualify for the State Bank of India's Central Scheme for Interest Subsidy (CSIS) can submit an application at any branch. They must provide their income certificate from the certifying body in order to apply.
FAQs on SBI Interest Subsidy
- Will the students be eligible under CSIS scheme, if they have availed subsidy under any other scheme?
Students enrolled in postgraduate diploma, master's, M.Phil., doctoral, or postgraduate degree programs are eligible for this program. Students who are enrolled in an MBA program abroad and who received their M.Tech. from India through the CSIS program are also qualified for this program.
- Is the interest subsidy provided to all eligible candidates?
The interest subsidy is not promised to all qualified applicants. Only 400 candidates, as listed by state, urban region, and community in the annexure, are qualified under the conditions.
- Is interest subsidy applicable for loan amount above Rs.20 lakh?
As per Model Scheme of IBA, the loan amount for interest subsidy scheme is restricted to only Rs.20 lakh.
- What is the income limit under this scheme?
The candidate's or their parents' annual gross income, considering all income sources, cannot be more than Rs.6 lakh. Candidates must provide the necessary income documentation to verify their yearly gross income.
- Is there any quota for distribution of slots under this scheme?
The State or UT and Community are entitled to the predetermined quota under the program, as per Annexure-I. The benefits of the interest subsidy will be awarded to qualifying candidates. If there are no candidates for a certain state or UT, the seat will be awarded to other states or towns.
- Will a minority student be eligible under this scheme, if the course is pursed partly in India and partly in abroad?
Minority students are welcome to apply for this program, even if they study part of their coursework overseas and part in India. However, they must receive their degree from a foreign university.
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