Cent Vidyarthi Education Loan Scheme

About The Program:

Cent Vidyarthi Education Loan Scheme is offered by the Central Bank of India to provide financial assistance to students pursuing higher education in India or abroad. The scheme offers loans with flexible repayment options and potential interest subsidies. While collateral may be required for larger loan amounts, smaller loans can often be availed without security. The maximum loan amount under this scheme is ₹200 lakh. No margin money is required for loans up to ₹4,00,000. For loans above ₹4,00,000, a margin of 5% is applicable for studies in India, while for studies abroad, the margin increases to 15%.

Eligibility:

• Applicants must be Indian citizens.
• Candidates must have secured admission to a higher education course at a recognised institution in India or abroad.
• Admission must be based on an entrance test or a merit-based selection process after completing Class 12 or an equivalent qualification.
• If there is no entrance test or merit-based selection process, admission will be based on qualifying examination marks.
• The student must have obtained a minimum of 50% marks in the qualifying examination.

Note: Candidates belonging to the Scheduled Caste (SC) or Scheduled Tribe (ST) categories are eligible for a 10% relaxation in the minimum qualifying marks.

Benefits:

• Under this scheme, the maximum loan amount is ₹200 lakh. No margin money is required for loans up to ₹4 lakh. For loans exceeding ₹4 lakh, a margin of 5% is applicable for studies within India, and 15% for studies abroad.
• Banks may offer a 1% interest concession if interest is serviced during the study period and the subsequent moratorium period before repayment commences. Interest is calculated on a simple basis during the repayment holiday or moratorium period and compounded monthly from the due date of the first instalment.
• Payments will be made directly to the college, hostel, mess, airline, or other relevant entities. In specific cases, disbursements can be made to the borrower upon providing satisfactory proof. Original receipts must be submitted.
• Loans up to ₹4,00,000 are mandatorily covered under the NCGTC Guarantee Scheme. For loans above ₹4,00,000 but not exceeding ₹7,50,000, additional terms may apply.
• Loans exceeding ₹7,50,000 require a parent or guardian as a joint borrower. In all cases except for those up to ₹4,00,000, tangible collateral security equivalent to the loan amount is mandatory.
• Repayment Period:- The maximum repayment period is 15 years for all categories following the moratorium period. The moratorium period equals the course duration plus 1 year.
• Insurance:- A comprehensive life insurance policy equal to the loan amount must be obtained by the student availing the Educational Loan. This policy must have a minimum term covering the course period, moratorium period, and repayment period and be assigned in favour of the Bank.

The following expenses will be covered under the scheme:

• College/school/hostel fees
• Examination, library, and laboratory fees
• Travel expenses/passage for studies abroad
• Student/borrower insurance premium (if applicable)
• Caution deposit, building fund, or refundable deposit (supported by institution bills/receipts)
• Purchase of books, equipment, instruments, and uniforms
• Purchase of computer at reasonable cost (if required for course completion)
• Other expenses for course completion (e.g., study tours, project work, thesis)

Documents:

For Salaried Individuals:

• Income Tax Returns (ITR) – The applicant must submit their filed income tax returns for the previous two financial years.
• Form-16 – A certificate issued by the employer that provides details of the employee’s salary, deductions, and taxes paid.
• Salary Slips – The applicant should provide their payslips from the past three months, which indicate the monthly salary and deductions.
• Bank Statements – The applicant needs to provide their bank statements for the last six months, which reflect income credits and other financial transactions.

For Non-salaried Individuals:

• Income Tax Returns (ITR) – Non-salaried individuals must submit their filed income tax returns for the previous two financial years.
• Audited Balance Sheet – A financial statement that presents the assets, liabilities, and equity of the business or profession, audited by a chartered accountant.
• Bank Statements – The applicant should provide their bank statements for the previous year, showing financial transactions and income sources.

Other Documents Required:

• Admission Proof – A copy of the admission letter or offer letter from the educational institution where the applicant has secured admission.
• Certificates of Class 10 and 12 – Educational certificates of the applicant’s Class 10 and 12.
• Fee Structure – A document stating the detailed fee structure of the course or program for which the loan is being applied.
• Receipt of Payments Made – Any receipts or evidence of payments made towards admission fees, tuition fees, or other course-related expenses.
• Entrance Exam Scores – If admission to the course is based on an entrance examination, the applicant needs to provide the scores or rank obtained in the exam.