10 Steps to get an MBA education loan (2024)

The way of getting admission in a B-School is passed through tough rounds of tests; GD/PI. You have come here after beating competitions, and what? If you have to take a step back because of a lack of investment, lack of money for fees and for other facilities during your management course. Your career dream shouldn’t stop, there are bankers to help you. Education Loans will be your companion through-out the term in your dream B-school. Getting an education loan is a complicated process and every newcomer who is thinking of it should know basic things. Although the bankers are there to solve every quarry about getting an education loan we also here to help you out. In this topic, MBA education loan we are going to discuss 10 best points that every education loan seeker or every MBA aspirant who requires the loan, should know.

1- Choosing the Bank

Now a day, Every PSU and privet sector bank has plans of loan for MBA courses. almost every bank has their tie-ups with B-schools that maybe you don’t need to wander and will receive a call from the banks. Tie-ups with MBA institutions, banks provide extra facilities; They could provide lower interest on a loan than the market rate and easy and comfortable customer services.

2- Eligibility and Expenses

Following are the eligibility criteria for getting an MBA Education loan –

• Indian Citizen
• Age should be 16-35

The education loan will cover all the course fees. Some Banks also offer to cover some extra expenses during the course like –

• Tuition fees and Hostel rent
• Study material and gadgets
• Travels and study tour expenses

3- Basic Formalities requirements while applying for the loan

• Having confirmation latter for admission to the B-school you are going to study.
• Application for the loan
• Passport size photos
• ID proof
• Mark sheet of Previous exams you have passed.
• Bank and Income tax statements
• Assets and liability enclosure.

4- The process to apply

• submit an online application form on the website of the bank
• Bank officials will follow you – They contact the number provided in the form and ask few questions to the candidate and their parents.
• The official will visit you to collect the required documents and for other formalities.
• The credit analysis process will start – the bank will examine your assets and liabilities before giving the loan.
• After satisfaction from the bank side, The agreement is ready to sign.

This is an ideal process. Different banks could have a different process.

5- Repayment Process

The repayment process of the MBA loan starts after one year of completion of the course, and if the candidate got a job during the course the process would start after six months of joining the job. Generally, the amount of the loan paid in five years or seven years but the period is extendable with terms and conditions. For a loan of 10 lakh borrower will have to pay around 16 lakh with a 9.5% rate, which means around 20000 per month in 7 years after completion of the course.

6- Compare different schemes

Different banks have different rules for an education loan, some have a preference list of institutions and courses to lend loans at a specific interest rate. B-schools and banks have collaboration with sharing applicant’s data. Candidates supposed to get calls from the bank after they starting their process of doing an MBA from any institution. Websites like Bank Bazaar and My loan Care also provide that comparison chart chooses from different education loan schemes. Getting advice from professional bankers is the best way to go with them.

7- Benefit for Girls

To empowering women to participate in the higher education field and to be self-dependent, different IIM institutions promote girls to step ahead and Banks do so by landing loans at lower interest rates than the boy candidates. So if you are a girl and planning an MBA with dignity then there are so many bits of help available for you. Besides, if you have secured admission with a reputed MBA institution then it will be a booster for you.

8- Work Experience

If you are not a fresher for MBA and got some work experience by doing any job and applying for MBA for further growth in the career then you could have some more benefits; Banks could negotiate interest rates by 0.25% to 0.50%. Being already on job and have experienced increases your chances to get a well-paid job after completing the MBA, That is the reason banks will prefer you to give an MBA education loan.

9- What is the Moratorium

Well, an education loan is for convenience, to feel courage and confidence in the starting point of the course. This confidence further builds you to repay the loan before the completion and getting the job, this period is known as the Moratorium period. In simple terms, you repay your loan before the time. Banks indicate this period during the loan process. If borrowers repay the loan in this period they will get a 0.25% to 1% reduction in interest rate according to terms and conditions.

10- Government Schemes

From time to time government also encourages students, who have talents but lack money or for the students belongs to backward classes with its different loan schemes. Some of these schemes are ELISS – Education Loan Interest Subsidy Scheme and Vidya Lakshmi Portal – powered by NSDL. Candidates can also get help from these government schemes if they are eligible for the same.

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