Central Bank Student Loan – Best Guide For Applying Loan In 2023

Central Bank Student Loan of India Bank Limited is one of the largest and oldest commercial banks operating in India. It is home to 4730 branches and 5319 ATM’s, and four extension counters spread across 27 Indian states as well as 3 Union Territories. It offers a broad range of financial products and banking services to retail and corporate customers.

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What is an education central bank student loan?

An Education loan is a loans or money that are accumulated by a person to pursue higher education in India or in other countries. The repayment of the loan begins for the student once they have completed the educational program. A time period of 6 months is provided as a grace period for students to find or accept an employment.

The amount to be repaid can be calculated based on your personal choice of interest. You will need decide on the best way to pay off the loan. It is possible to pay the loan in the moratorium period as well as following the moratorium period. The period of moratorium is the duration of your studies plus six months or one year to obtain work. After this period that you will be legally required to pay for the loan.

The interest on the loan begins to accrue when the date when funds are dispersed which means that at the time of graduation, you will have a massive amount to pay back. Another option is that your parents or guardianship could begin paying the loan in the period of moratorium, where it will be calculated as a simple interest. The amount of your loan when you graduate will be drastically diminished.

Four types of central bank student loan

1. Under graduate education loan – This loan is given for students that have completed their secondary schooling and are planning to pursue further studies as under graduation. It is possible to get it in India or elsewhere.

2. A Post-graduate education loan – These are loans to help with education to those who wish to pursue post-graduation following completion of an under-graduation courses from an accredited university or college. The loan may be used for studies in India or in other countries.

3. Parents who take out a loan for education – The situation is in which parents use loans for education reasons that their child is pursuing. It’s an unsecure loan, and is not necessary to be used for post-graduation and graduate courses, but it can be used for secondary and elementary courses.

4. Career growth education loans – These are loans given to students who wish to study or obtain training or certifications that will aid their professional development.

Advantages of central bank student loan

Below are some benefits that come with applying through Central Bank Student Loan in India.

Low interest rate
A lesser amount of paperwork
No processing charges
Faster Disbursal
No charges for prepayment

Expenses covered

Fee to be paid to the college/school/hostel
Examination/ Library/ Laboratory fee
Money for travel expenses/passage to study in other countries
The insurance premium for students who borrow in the event that it is appropriate
Deposit for caution, construction fund or refundable deposit backed by Institution receipts or bills.
Purchase of equipment, booksor instrumentsor uniforms
The purchase of a computer is at a reasonable cost, if necessary to finish the course
Other expenses required for the completion of the course like study trips, project work, thesis, etc.
In computing the loan requirement and the scholarship, fee waiver, etc. If any offered to the can be considered

Interest rate

The rate of the interest of male students is MCLR + 2.00 percent.

For female/SC/ST/IIT students : MCLR + 1.50 Percentage.

The concession amount of 1% is offered if the interest is paid during the studying or during the moratorium period.

How to apply for central bank student loan?

You can apply online, or go to an nearby Central Bank of India branch to fill out the application. Download the application form on the Central Bank in India official website, fill out the form, and then submit it to the representative of the bank. You can also verify your eligibility for an educational loan with Credit Mantri and then apply for it.

Documents required

Letter of admission
Filled in Loan Application Form
2 passport size photographs
Cost of study statement
PAN Card of the student as well as the Parent/Guardian
AADHAR Card of the student as well as the parent/guardian
Proof of identity (Driving License /Passport/Aadhar/ any photo identity)
Proof of residence (Driving License /Passport/Electricity bill/Telephone bill)
Bank account of student/co-borrower/guarantor statement for the last six months
IT return/IT assessment order, from two years prior to the last 2 years of parent/Guardian/other co-borrower (if IT Payee)
A brief description of the assets and liabilities of Parent/Guardian and other co-borrowers.
Evidence of income (i.e. Salary slips/ Form 16) Parent/Guardian or any another co-borrower

EMI payment methods

Central Bank Student Loan is repayable in the three ways.

Standing instruction (SI): If you’re an existing account holder at Central Bank of India, Standing Instruction is the most efficient method of payment. It is a way to ensure that your EMI payment will be deducted automatically at the conclusion of the month cycle through your Central Bank of India account that you have specified.

Electronic clearing service (ECS): This mode is available for those who do not have a Central Indian Bank account, and wish to have your EMIs to be automatically debited at the end of each month’s cycle from the account.

Post-dated cheques (PDCs): You can present post-dated EMI cheques made from an account that is not a Central bank account to the nearest india Central Bank Loan Centre. A new set of PDCs are required to be received promptly. Please note that Post Dated Cheques are accepted at in non-ECS facilities only. It is recommended to choose either the SI or ECS option to pay more speed and less susceptible to error than the usage of PDCs.