Finance
Education Loan Guide India: Rates and Repayment
Education loan rates in India run from 6.90% for premier institutes to 13% from private lenders. Where you study changes the rate more than who you are.
By Nina Shah · Updated · 9 min read
Short answer
Which bank gives the cheapest education loan in India?
SBI offers the lowest education loan rates in India - 6.90% to 7.65% under the Scholar scheme for IIT, IIM and NIT students, 8.90% to 9.40% for studying abroad under Global Ed-Vantage, and 9.40% to 9.90% for a standard student loan. HDFC Bank charges about 10.25% and HDFC Credila 11% to 13%. Girl students get a 0.50% concession at most lenders, and public bank rates float with the RBI repo rate.
Our practical verdict
Education loan pricing in India is unusual in that where you study matters more than your own financial profile. SBI's Scholar scheme charges 6.90% to 7.65% for students at listed IITs, IIMs and NITs - cheaper than most home loans - while the same bank's standard student loan runs 9.40% to 9.90%, and private lenders reach 13%.
That means the first question is not which lender but which scheme you qualify for. If your institution appears on a premier list, applying anywhere else is usually a mistake, even if the process is slower and the paperwork heavier.
For study abroad the calculation shifts. SBI's Global Ed-Vantage at 8.90% to 9.40% is markedly cheaper than HDFC Credila at 11% to 13%, but Credila funds universities that public banks will not, and approves faster. If your admission deadline is close or your university is off-list, paying the premium may be the only workable route.
Shortlist
Recommended options to compare
Use this as a starting list, then compare live India prices and warranty before buying.
Pick 1
SBI Scholar, 6.90% to 7.65%
The cheapest education borrowing available in India, for students admitted to listed IITs, IIMs and NITs. If you qualify, nothing else comes close and it is worth accepting the slower process.
Pick 2
SBI Global Ed-Vantage, 8.90% to 9.40%
For study abroad, and substantially cheaper than private lenders for the same purpose. The constraint is SBI's approved university list.
Pick 3
SBI standard student loan, 9.40% to 9.90%
The default for domestic study outside the premier institutes. Still among the lowest rates available.
Pick 4
HDFC Bank, about 10.25%
Faster processing than public banks at a modest premium. Reasonable middle ground if SBI's timeline does not fit your admission deadline.
Pick 5
HDFC Credila, 11% to 13%
The most expensive here, and the most flexible. It funds universities not on public bank lists and approves faster, which is exactly what you are paying for.
Which option should you choose?
SBI Scholar, 6.90% to 7.65%
The cheapest education borrowing available in India, for students admitted to listed IITs, IIMs and NITs. If you qualify, nothing else comes close and it is worth accepting the slower process.
SBI Global Ed-Vantage, 8.90% to 9.40%
For study abroad, and substantially cheaper than private lenders for the same purpose. The constraint is SBI's approved university list.
SBI standard student loan, 9.40% to 9.90%
The default for domestic study outside the premier institutes. Still among the lowest rates available.
HDFC Bank, about 10.25%
Faster processing than public banks at a modest premium. Reasonable middle ground if SBI's timeline does not fit your admission deadline.
HDFC Credila, 11% to 13%
The most expensive here, and the most flexible. It funds universities not on public bank lists and approves faster, which is exactly what you are paying for.
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| Situation | Best starting point | Final check |
|---|---|---|
| SBI Scholar, 6.90% to 7.65% | The cheapest education borrowing available in India, for students admitted to listed IITs, IIMs and NITs. If you qualify, nothing else comes close and it is worth accepting the slower process. | Use this as a shortlist, then verify the final details before committing. |
| SBI Global Ed-Vantage, 8.90% to 9.40% | For study abroad, and substantially cheaper than private lenders for the same purpose. The constraint is SBI's approved university list. | Use this as a shortlist, then verify the final details before committing. |
| SBI standard student loan, 9.40% to 9.90% | The default for domestic study outside the premier institutes. Still among the lowest rates available. | Use this as a shortlist, then verify the final details before committing. |
| HDFC Bank, about 10.25% | Faster processing than public banks at a modest premium. Reasonable middle ground if SBI's timeline does not fit your admission deadline. | Use this as a shortlist, then verify the final details before committing. |
Read the editorial notes
The 0.50% concession for girl students applies at most lenders and is worth about a lakh of interest on a Rs 20 lakh loan over ten years. Check it appears on the sanction letter rather than assuming it was applied.
Repayment begins after a moratorium of the course period plus six to twelve months, but interest generally accrues throughout. Paying just the interest while studying, where a family can manage it, avoids that interest being capitalised and can cut the total cost substantially.
Before borrowing: 1. Confirm whether your institution is on the lender's approved list, which sets the rate band. 2. Check whether collateral is required - usually above Rs 7.5 lakh. 3. Ask whether interest accrues during the moratorium and whether servicing it is allowed. 4. Section 80E allows a deduction on education loan interest with no upper limit for eight years, which materially lowers the effective rate for a working co-borrower.
Decision shortcut
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Use the table above to shortlist your best fit, then check related picks, tools, and buying guides before you make the final call.
FAQ
Which bank gives the cheapest education loan in India?
SBI, by a clear margin. Its Scholar scheme for IIT, IIM and NIT students runs 6.90% to 7.65%, and even its standard student loan at 9.40% to 9.90% undercuts most private lenders. The trade-off is processing speed and a stricter approved-institution list.
Do girl students get a lower education loan rate?
Yes, most lenders offer a concession of about 0.50%. On a Rs 20 lakh loan over ten years that is worth roughly a lakh in interest, so it is worth confirming the concession has actually been applied to your sanction letter.
When does education loan repayment start?
After a moratorium covering the course period plus six to twelve months. Interest usually accrues during that time even though you are not paying, so servicing the interest while studying, if you can, meaningfully reduces the final cost.
This guide is educational. Interest rates, charges and eligibility in India change frequently and vary by borrower profile, so verify current terms with the bank before applying.
Finance Guides Lead
Nina writes about everyday money decisions, credit cards, calculators, and transparent personal finance tools.
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How Choice IQ evaluated this guide
Choice IQ evaluates education loans in India by scheme eligibility, approved institution lists, rate bands for domestic and overseas study, moratorium and interest capitalisation, collateral thresholds and the section 80E deduction.
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