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Education Loan
  1. Jammu and Kashmir Bank – Education Loan

In today’s highly competitive world the need to be academically well-qualified cannot be overstressed. As a result of this exceptional demand, good education opportunities seem few and far between leading to astounding hikes in the cost of higher studies. Thankfully, there is the option of student loan schemes and this is gaining popularity among students who want to pursue higher studies. This means that higher education is now no longer just a dream for students. More and more banking institutions are making the way smoother for students by sanctioning education loans for studying in professional courses both in India from any recognized educational institution as well as abroad.

Jammu and Kashmir Bank was incorporated in the year 1938 and is listed as the universal bank of the state of Jammu and Kashmir. The bank is regarded as a specialised and functional bank in other parts of the country. This bank has a pan-India presence with 833 branches and 726 ATMs spread across the nation. The Jammu and Kashmir bank is rated P1+, indicating the highest degree of financial stability by Standard and Poor’s and CRISIL. Jammu and Kashmir bank is the sole bank operated by the state government of Jammu and Kashmir.

Jammu and Kashmir Bank offers its customers three types of schemes for education loans and each of the J&K Bank education loan schemes serve a different purpose. While one scheme provides loan for higher education in India or abroad, a second scheme provides loan for M. Ed or B. Ed courses and the third scheme provides loan for primary education. So providing such different varieties of loan schemes, the bank tries to meet all the requirements of individuals seeking an Education Loan and boosting the morale of financially poor but meritorious students deserving to pursue higher studies without any financial obstacle from alleged educational institutions in India or abroad. Let us take a detailed look at the versions of Education Loans which the bank offers and the features of each.

2. Types and Key Features of various J&K Bank education loan schemes:

J&K Bank offers a range of education loan schemes in order the support the education

  1. Education Loan Scheme – a J&K Education Loan scheme which provides finance to students seeking higher education either in India or abroad. The salient features of the loan are:
  • The maximum amount of loan is Rs. 10 lakh if taken for studying in India and Rs. 20 lakh for courses taken abroad.
  • Availing J&K Bank education loans of up to Rs. 10 lakh for pursuing higher education in IIMs or IITs or Indian School of Business, Hyderabad, co-obligation of the parents or guardians, a third party guarantee of two persons and the assignment of future income of the student is required as security. Other than this there is no other requirement of a collateral security is required.
  • For other courses, for J&K Bank education loans up to Rs. 4 lakh, pledging a security is not required. Only parents should act as co-borrowers. But for loans above Rs. 4 lakh, security is required by the bank. For loans higher than Rs. 4 lakh up to Rs. 7.5 lakh, collateral security is needed in the form of a third party guarantee is enough along with the parents acting as co-borrowers. The third party guarantee may be waived by the bank if the net-worth of the parents is sufficient enough as per the bank’s standards. For loans above Rs. 7.5 lakh, co-obligation of the parents along with a tangible collateral security equivalent to the value of the loan granted is required as a collateral security.
  • For J&K Bank education loan up to Rs. 4 lakh, there is no requirement of margin. But for loans above Rs. 4 lakh, margin is maintained by the bank. For studying in India the margin is 5% and for studying abroad, the margin requirement is 15%.
  • The repayment period is a maximum of 10 years for a loan amount of up to Rs. 7.5 lakh and 15 years for amounts above Rs. 7.5 lakh which should start immediately after the completion of the moratorium period.
  • The repayment period may be extended for up to a maximum of 2 years if the student fails to complete the course within the due time.
  • The moratorium period will be either 1 year after course completion or 6 months post getting a job whichever is earlier under this J&K Bank student education loan
  • A penal interest of 2% for loans above Rs. 25,000 is charged for the overdue amount and overdue period.
  • An interest subsidy on J&K Bank education loan scheme is available for minority students for studies abroad wherein the interest on the Education Loan within the continuation of the moratorium period will be borne by the Government post which the students will pay off the loan amount and the respective interest
  • J&K Bank education loan doesn’t focus on expediency rather their focus is towards nation building as it is education which is central to the development of human resources and is nation’s priority with an objective that no deserving student is denied higher education due to financial reasons.

Eligibility: The education loan eligibility criteria are listed below for the bank:

  • The student must be an Indian citizen.
  • He or she must have confirmed admission into a professional or technical course within India or overseas through a merit-based selection procedure or an Entrance Test after completing HSC i.e.10+2 education.
  • The list of eligible courses under this J&K student education loan include graduation or post-graduation courses, professional courses like engineering, computer science, medical, veterinary, agriculture, dental, law, management, etc. Courses conducted by leading institutes  like IIMs, IITs, XLRI, IISc, NID, NIFT and other leading institutes set up by the Central or State Government. The loan also covers other courses that lead to a degree or diploma conducted by colleges or universities approved by Govt. / UGC / AICTE /ICMR/ ABIMS, etc. Additionally, courses including ICWA, CA, CS, etc., regular degree/diploma studies in the fields of aeronautics, shipping, pilot training, nursing degree / diploma or any additional discipline that is approved by Director General of Shipping / Civil Aviation/Indian Nursing Council as well as any other government regulatory body accredited courses within India.
  • For studying abroad, the list of courses include graduation for job oriented courses offered by reputed universities, post-graduation programmes like MCA, MBA, MS, etc., courses conducted by CIMA, London, CPA in USA, etc., degree or diploma courses like aeronautical, pilot training, shipping provided these are recognized by competent regulatory authority in India or abroad for the purpose of employment in India or abroad
  • For the Interest Subsidy scheme, total income from all sources of the employed candidate or his / her parents/guardians in case of unemployed candidate shall not exceed Rs. 6 lakh per annum and the Income certificate should be submitted from the competent authority in the State/ Union Territory.
  1. Term Loan for B. Ed and M. Ed courses – a J&K student education loan scheme where in finance is provided to students pursuing B. Ed or M. Ed courses. The scheme’s features are as follows:
  • The J&K Bank student loan scheme is provided to students or employed individuals who wish to pursue M. Ed or B. Ed courses.
  • The student loan scheme is given to meet course related expenses like admission fees, tuition fees, examination fees, library and lab fees
  • The J&K Bank education loan is offered as a term loan
  • The maximum amount of loan available under this student loan scheme is Rs. 25,000
  • There is a margin requirement of 10% under the J&K Bank education loan
  • Security is required for availing the J&K Bank student loan scheme which should be in the form of a third party guarantee of one person
  • Processing charges of 0.05% of the loan amount is to be paid with a minimum of Rs. 25
  • This J&K student scheme loan should be repaid within 12 months


  • The student should be a citizen of India.  
  • The student must have completed graduate studies from a recognized university.
  • The student must have letter confirming admission in a reputed College/Institution which imparts M. Ed or B. Ed educational courses.
  • The loan application form should be forwarded by the Principal of the college.
  1. Budshah Primary Education Finance – a J&K Bank education loan scheme for students pursuing primary education. The features of the loan are as follows:
  • It is a term loan which is granted to facilitate students to have a good primary education
  • The loan for courses undertakes to finance the complete cost of a child’s education including cost of books, uniforms, school fee, etc.
  • The maximum amount of education loan available for Primary Education is Rs. 30,000 in a private school and Rs. 2,000 in a Government school. For Secondary education, the maximum loan amount available is Rs. 25,000 in a private school and Rs. 5,000 in a Government school
  • There is a margin requirement of 10% under the J&K student loan scheme
  • A security in the form of personal guarantee from the parent or legal guardian and a third party guarantee of one more person is required which is waived off in case of Government employees who draw their salary from the J&K Bank branches.
  • Processing charges of 0.05% of the loan amount is to be paid up front with a minimum of Rs. 25.
  • The loan amount should be repaid within 12 months through 12 Equated Monthly Instalments
  • This loan can be easily sanctioned by the bank for higher studies from good educational institutions provided you submit all the educational documents and other loan documents asked by the bank.


  • All children aged 3 years and above are eligible to avail the J&K Bank student education loan which will be granted in the name of the guardian
  • The applicant is required to produce a valid certificate from the school which states that admission has been granted to the child
  • The school Principal needs to forward the loan application.
  • The parent or guardian should have an independent source of income
  • The school should be registered/accredited
  1. J&K Bank Education Loan Subsidy: The Ministry of Minority Affairs of the Government of India which is responsible for minority affairs offers interest subsidy on education loans for overseas studies to students of minority communities. This scheme came into action from 1st April 2013. This student loan scheme offers following features and benefits:
  • This loan subsidy is available to students either at master’s level or doctorate level only once during the course of their education.
  • This is student loan scheme subsidy is restricted only to students of minority communities pursuing either their post graduation or M Phil, PhD, PG courses.
  • Students must retain their Indian citizenship throughout the tenure of loan
  • Students who are pursuing higher studies and have availed any other subsidy from central or state government scheme are also eligible for this subsidy scheme
  • The subsidy is also available for loans under Rs. 20 lakh
  • The total annual income of student’s family must not exceed Rs. 6 lakh per annum.
  • Student would also be asked to produce income certificates issued by efficient authorities for the same
  • This subsidy is not available for the repayment period of the loan

3. Jammu and Kashmir Bank Education Loan Rate of Interest

The banks rates of interest on education loans are generally lower than most of the banks. While freeing the scheme of whack of interest rate, the bank has thrown open the opportunity to learn to all fitting students community. In the current market scenario, the loan offered by the bank is cheaper than any other bank. While other banks are increasing their lending rates, J&K Bank reduced the rate of interest for its student loan scheme from 10% to 9% for loans up to Rs. 25,000 followed by other amount of education loan. The decrease in the interest rate under the J&K Bank education loans are despite the fact that bank amended its prime lending rate and increased it from 11% to 12%, hence making it clear that education loans are one of the priority areas for the bank.

Education Loan for up to 5 years at a fixed rate of interest

For loan amount up to Rs. 10 lakhs

MCLR + 1.5% (Fixed)

For loan amount above Rs. 10 lakhs and up to Rs. 20 lakhs

MCLR + 2.5% (Fixed)

For loan amount above Rs. 20 lakhs

MCLR + 3% (Fixed)


Education Loan with tenures 5 years and above at floating rate of interest

For loans up to Rs.10 lakhs

MCLR + 1.5% (Floating)

For loans above Rs. 10 lakhs and up to Rs. 20 lakhs

MCLR + 2.25% (Floating)

For loans above Rs. 10 lakh and up to Rs. 20 lakh

MCLR + 2.75% (Floating)

4. Applying Online for Education Loan from Jammu and Kashmir Bank

The bank facilitates easy application of the student loan scheme by providing the avenue of online loan application from of the same. The process is simple and you only need to log on to the bank website and follow the steps required in order to complete the application process. The necessary details include the applicant’s name, address, contact number and other personal details which would be required to match the applicant’s eligibility against the required eligibility of the loan. If the eligibility criteria are fulfilled, the necessary documentation needs to be completed and the loan would be sanctioned by the bank subject to completion of the necessary formalities. The online application avenue removes various administrative hurdles and eases the application process both for the applicant and for the bank.

The bank has its branches spread throughout India and applicants can even approach a nearest branch for completing the application process or making an application for the loan. The bank’s personnel designated for the loan processing service would assist the customer to complete the required actions to avail the J&K Bank education loan. The bank has also follows an agenda for fair and expeditious handling of customer’s grievances. In case of any difficulty in personal transactions, J&K student loan scheme or any other deadlock, the customers may approach the officer concerned or branch manager. The bank representatives will ensure that customer’s needs are attended to. However, if for some reason their problem is not solved, customer may demand the complaints books, which are available in all branches and register their complaints. They can also lodge written complain through email.