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Education Loan
  1. UCO Bank Education Loan  

An education loan is one of the most important loans of current times as it not only helps students pursue their dream of higher studies from the most reputed and recognized educational institutions but also boosts the knowledge economy of our country. Most of the banking and financial institutions have realised the importance of scheme for education loans and therefore they have started offering student loan scheme with many benefits at lower interest rates.

UCO Bank is a commercial bank and a Government of India undertaking offering a range of banking products and services consisting of savings account and host of loan options comprising of home loan, car loan, personal loan, gold loan and various student loan schemes. UCO Bank education loan offers financial assistance to deserving and commendable students who are looking to pursue higher education from leading educational institutions in India as well as abroad.

UCO Bank offers Education Loan to students to enable them to pursue higher education either in India or abroad. Thus, students can achieve their dreams of higher education without having to worry about the necessary funds which will be provided by the bank. The bank offers 3 types of Education Loans to students for different education schemes. Let us take a look at the types of loans being offered by the bank as well as their various features and benefits.

2. Types of UCO Bank Education Loans Offered

  1. UCO Bank Education Loan –this UCO Bank education loan is provided to meritorious students so that they can pursue higher education either in India or abroad. The features of UCO Bank student education loan are as follows:
  • The courses covered under the scope of the student loan scheme for studies in India include approved courses leading to graduate or post-graduate Masters and PhD. Degree and PG Diplomas conducted by recognized college or universities, Engineering, Medical, Agriculture, Veterinary, Law, Dental, Management, Computer, etc., computer certificate courses or reputed institutes credited to DoE and courses like ICWA, CA, CFA, etc.
  • For studies abroad graduation courses include job oriented professional or technical courses offered by universities of repute and post-graduation courses include MCA, MBA, MS, courses conducted by CIMA in London, CPA in USA, etc.
  • The maximum loan amount which can be taken is Rs. 10 lakh for studying in India and Rs. 20 lakh for studies abroad. The loan which is granted would depend on the student’s need and his capacity to repay it duly.
  • Margin requirement is essential in this type of student loan scheme if the value of the loan amount exceeds Rs. 4 lakh. If the UCO Bank education loan is taken for Indian studies, the margin requirement would be limited to 5% of the loan and if it is taken for foreign studies, the margin requirement would increase to 15%.
  • The requirement of a security is also not required for loans which are limited to Rs. 4 lakhs. For UCO Bank education loans increasing this value and going up to Rs. 7.5 lakhs, collateral security required would be a third party guarantee along with the co-obligation of parents. For loans above Rs. 7.5 lakhs, the co-obligation of the parents would not be enough. A tangible collateral security whose worth equals the quantum of the loan granted is also required
  • A Group Life Insurance coverage scheme is offered to cover the outstanding amount of loan in case of accidental or natural death of the borrower.
  • These loans attract no processing fee.
  • For loans which are within the limit of Rs. 7.5 lakhs, the maximum tenure for repayment is granted for 10 years while loans of a higher value have a period of 15 years
  • There is a repayment holiday of course period + 1 year or 6 months after getting the job whichever is earlier
  • 1% discount in interest is offered during the moratorium period if interest is paid regularly

Eligibility: The education loan eligibility criteria for this product are listed below:

  • The student should be an Indian National who has secured admission in a higher education course in India or entrance test or selection process after completion of HSC.
  • For graduation courses the age limit is 28 years for General candidates and 30 years for SC/ST candidates. For post-graduation course, the age limit is 30 years for general candidates and 33 years for SC/ST candidates

Rate of Interest

  • For loans up to Rs.7.5 lakh the interest rate is 2.00% over 1yr. MCLR
  • For loans above Rs.7.5 lakh, interest rate is 2.40% above 1yr. MCLR

Note: All regular/ full time graduation, post graduation and professional course study in India are eligible under this UCO Bank student loan scheme.

  1. UCO Premier Education Loan Scheme – This UCO Bank student loan scheme is designed to provide funds at preferential rates to students who have secured admissions in a premier Educational Institutions in India or abroad. The features and benefits of the UCO Bank student education loan are as follows:
  • The maximum amount of loan granted depends on the institute’s eligibility as per a pre-determined list prepared by the bank. If the institute qualifies in List A of the bank, the maximum amount of education loan is Rs. 30 lakh, if it is in List B, the maximum amount is Rs. 20 lakh and for institutes falling in List C, the maximum is Rs. 15 lakh.
  • For loans up to Rs. 4 lakh there is no requirement of a margin but for loans of higher value, margin is required which is 5% of the total course fee and other expenses
  • A Group Life Insurance coverage scheme is offered to cover the outstanding loan amount in case of accidental or natural death of the borrower
  • For loans up to a specified limit under each list of institute, no security is required only parent or spouse or guardian should act as a co-borrower. But for higher amounts, security in the form of a tangible security of the full value of the loan and parent or spouse or guardian acting as a co-borrower is required. The limits requiring security for List A is over Rs. 20 lakh to Rs. 30 lakh, for List B is over Rs. 15 lakh to Rs. 20 lakh and for List C is over Rs. 10 lakh to Rs. 15 lakh
  • The maximum loan amount for studying abroad is Rs. 30 lakh and up to Rs. 15 lakh no security is required only parent or spouse or guardian should act as a co-borrower. Over Rs. 15 lakh, security in the form of a tangible security of the full value of the loan and parent or spouse or guardian acting as a co-borrower is required.
  • The repayment tenure of the loan is a maximum of 15 years or 180 instalments
  • There is no processing or upfront charges under the UCO Bank education loan

Eligibility: The following are the courses eligible for a loan under the vocational education and training scheme of UCO Bank

  • For studying in India, the courses covered are full-time Degree or Diploma courses and Part-time courses offered by Institutes eligible under the scheme.
  • The admission in the course should be obtained through an Entrance Test, Selection Process or Percentage of Marks prescribed by the Institute
  • The age limit for General candidates is 38 years and for SC/ST candidates is 40 years
  • For studies abroad, the University/Institute must be ranked in World Top-150 universities as per on the application date
  • The eligible courses for international study are post-graduate, post-graduate diploma, Doctoral, Post-graduate studies, Engineering & Technology, Medicine, Management & Law streams

Rate of Interest

Interest on education loans offered by UCO Bank is calculated adding the 1yr. MCLR + 1.15%.

  1. UCO Bank Vocational Education and Training Loan is provided to students with minimum educational qualification who wish to pursue vocational education and training. The features and benefits of the UCO Bank loan for vocational education and training are as follows:
  • The amount of loan for vocational education available depends on the course duration. For courses up to 3 months the quantum is Rs. 20,000 for durations from 3 months to 6 months the quantum is Rs. 50,000, for durations of 6 months to 1 year the amount is Rs. 75,000 and for durations above 1 year the amount is Rs. 1.5 lakh.
  • There is no requirement of maintaining a margin under vocational education and training loan scheme.
  • The moratorium period is 6 months post course completion for courses up to 1 year and 12 months post course completion for courses of duration above 1 year under this loan scheme of vocational education and training
  • 1% discount in interest is offered during the moratorium period if interest is paid regularly and simple interest is charged during that period
  • There is no processing charge or prepayment charge under the loan for vocational education.
  • Security is not required but the parent should act as a co-borrower of the vocational education loan and vocational training loan.
  • The repayment tenure of loan is 2-5 years for courses of durations up to 1 year and 3-7 years for courses above 1 year

Eligibility

  • The courses eligible under the loan are vocational education and training or skill-development courses of durations 2 months to 3 years supported by a Ministry / Department / Organization of the Government or a company / society / organization supported by NSDC or State Skill Missions / State Skill Corporations preferable leading to a certificate, diploma or degree issued by a Government organization or authorized by the Government.

Rate of Interest

  • The interest rate is 2.00% above 1yr MCLR for this vocational education and training loan scheme
  1. UCO Super Premier Student Loan Scheme: this UCO Bank student scheme provides financial support at preferential terms to students who have secured admission in any of eight specific premier educational institutions in the country. Following is the list of institutions eligible for this UCO Bank education loan:
  • Indian institute of Management, Ahmadabad
  • Indian institute of Management, Bangalore
  • Indian institute of Management, Lucknow
  • Indian institute of Management, Indore
  • Indian institute of Management, Jamshedpur
  • Indian institute of Management, Hyderabad
  • Indian institute of Management, Kolkata
  • Indian institute of Management, Kozhikode

Age limit:

Minimum age limit for this UCO Bank student education loan for general category of candidates it is 38 years and for SC / ST it is 40 years. The bank does not require any kind of margin under this student loan scheme. The moratorium period includes course period plus additional one year period after completion of the course. UCO Bank before sanctioning the loan amount would ask for educational documents and other loan documents and therefore you should ensure that you have all of these loan documents with you.

Rate of interest:

Under such loan for courses offered by the bank simple interest is to be charged during the moratorium period or repayment holiday period. Servicing of interest during moratorium period is optional. However, accrued interest will be added to the principal amount borrowed while fixing EMI for repayment. The loan is available at the prevailing 1yr. MCLR. Penal interest at 2% p.a is charged on belated amount for the overdue period.

Repayment option:

Repayment of this student loan scheme offered by the bank will be in maximum 180 equated monthly instalments, that is in 15 years after the moratorium period or repayment holiday is over.

3. EMI Calculator

The bank offers the facility of calculating the Emi payable based on the quantum of loan and the tenure so that customers can determine whether they would be able to pay off the loan. The following instances calculate the EMI payable under different scenarios.

  • A applies for an UCO Bank education loan to pursue higher Education in India to the tune of Rs. 5 lakh. He promises to pay off the loan in 6 years post the moratorium period. The bank charges him an interest rate of 12.70% which is 2.50% above the Base Rate of 10.20%. At this rate, the EMI payable by A comes to Rs. 9,958 approximately
  • B applies for an UCO Premier Educational Loan Scheme from the bank for meeting the fees payable to IIM-A a List A institute to which he has secured admission. The loan amount sought is Rs. 15 lakh which is to be repaid in 10 years as chosen by B. the rate of interest is 11.20% for which the EMI payable is Rs. 13,888 approximately.
  • C applies for an Education Loan for Vocational Education and Training for a course of duration 6 months. The amount of loan granted is Rs. 50,000 repayable in 3 years. The rate of interest charged is 12.70% for which the EMI payable is Rs. 1,677 approximately.

The above data is tabulated in the table below for an instant reference:

Applicant

Loan Amount

Interest Rate

Term

EMI

A

5 lakh

12.70%

6 years

9958

B

15 lakh

11.20%

10 years

13,888

C

0.5 lakh

12.70%

3 years

1,677

4. Applying Online for UCO Bank Education Loan

The online education loan application process of UCO Bank is simple to complete. All you need to do is input a few details about yourself in order to view the applicable loan offer from UCO Bank. Once you have filled out the online application, if your application is accepted by the bank, you will be contacted by a UCO Bank representative to complete other loan formalities.