New Delhi, Feb 27 (IANS) India’s largest lender, State Bank of India (SBI) Monday said it has reduced the interest rate on educational loans by up to one percent across different segments.
“In order to extend financial assistance to students pursuing higher education in India and abroad at affordable rate, SBI has reduced the rate of interest for education loans,” the bank said in a statement.
The new rates are applicable from Monday.
Loans up to Rs.4 lakh will get an interest benefit of 0.25 percent at 13.5 percent while loans between Rs.4 lakh and Rs.7.5 lakh will become cheaper by one percent at 13.25 percent.
Loans beyond Rs.7.5 lakh will get 0.25 percent relief at 12 percent.
Under the student loan scheme, loans up to Rs.10 lakh for studies in India and upto Rs.20 lakh for studies abroad are given.
Besides, under SBI scholar loan scheme, loans are extended to students joining elite institutions like IIMs, IITs, NITs and others.
At present, 111 institutes are covered under this scheme and loans up to Rs.15 lakh are given.
Loans are sanctioned without any security except the parent or guardian as co-borrower. The rate of interest under this scheme has also been reduced by 25 basis points.
Thus, the new rate of interest is 200 bps above base rate, currently 12 percent per annum. In addition the bank would offer 0.50 percent additional concession for girls.
The base rate of the bank is 10 percent.