Top 10 Banks with Lowest Interest Rates on Education Loans starting at 6.80%

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Investment

oi-Vipul Das

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It is safer to finance the studies of your child or children through investments. If you have not been able to save enough to cover the growing higher education tuition fees for your children, you can opt for education loans. Student loans are granted for a period of 7 to 8 years. Considering the same, it is better that you opt for a bank that offers you low interest rates and an acceptable term based on your eligibility.

Banks ROI year in %
Union Bank 6.80
central bank 6.85
Bank of India 6.85
Bank of Baroda 6.85
National Bank of Punjab 6.90
SBI 6.90
IDBI Bank 6.90
Bank of Maharashtra 7.05
Indian bank 7.15
Overseas Indian Bank 7.25

The Union Bank of India is currently offering the lowest interest rate on the student loan, starting at 6.8% for student loans of Rs 20 lakh with a tenor of seven years, according to the table. above. With a current interest rate of 6.85% on education loans of Rs 20-lakh with seven-year terms, the Central Bank of India, Bank of India and Bank of Baroda are the following. Indian Overseas Bank (IOB) is the most expensive loan deal on the list of ten cheapest student loans and has an interest rate of 7.25%, which is much lower than 9.55% , 9.70% and 11.25%, respectively, offered by HDFC Bank, Axis Bank and ICICI Bank. Under Section 80E of the Income Tax Act, the interest you repay on your monthly EMI qualifies you for exemption from income tax.

Banks offering the lowest interest rates on student loans starting at 6.80%

Processing fees should be verified by you when applying for a student loan, and they vary from bank to bank. Based on interest rates, banks are ranked in ascending order, i.e. banks with the lowest interest rate on education loans (loan value up to Rs 20 lakh) are placed at the top and highest at the end. The table considers the lowest rates provided by banks on loans up to Rs 20 lakh. The EMI, excluding GST, is determined on the basis of the interest rate for the term of seven years and a loan amount of Rs 20 lakh loan. For the purposes of estimating the IME, the processing fee and other fees are considered zero.

Article first published: Wednesday, December 23, 2020, 1:50 p.m. [IST]

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