Indian Overseas Bank Education Loan Interest Rates, Eligibility, Documents, FAQs

Education is the key to unlocking a bright future, but the rising cost of education can often be a barrier for many students. However, financial constraints should help your aspirations. Indian Overseas Bank (IOB) understands the importance of education and offers customized education loan schemes to help you pursue your dreams. In this blog post, we will delve into the details of the Indian Overseas Bank Education Loan, covering interest rates, key features, eligibility criteria, required documents, and frequently asked questions.

Indian Overseas Bank Education Loan Interest Rates

Interest Rates of Indian Overseas Bank Education Loan:

Indian Overseas Bank offers competitive interest rates on education loans. The interest rate is subject to periodic revisions, so it's advisable to check the bank's website or contact the nearest branch for the latest rates. IOB provides interest rate concessions to deserving and meritorious students, encouraging academic excellence.

Maximum of Rs.30.00 lakhs for studying in India and Rs.40.00 lakhs for studying abroad


For loans upto Rs. 4.00 lakh Nil
For loans above Rs. 4.00 lakhStudies within India 5%
For studies abroad 15%


For loans upto Rs.4.00 lakh Co-obligation of parents. No security
For loans above Rs.4.00 lakh and up to Rs.7.50 lakh Co-obligation of parents and collateral security in the form of a suitable third-party guarantee.
 For loans above Rs.7.50 lakh Co-obligation of parents together with tangible collateral security.Collateral security in the form of NSC /KVP/ LIC Policy/ Immovable properties/ Bank Deposits in the name of student/Parent/Guardian or any other third party with suitable margin. Wherever the land/ building is already mortgaged, the unencumbered portion can be taken as security on a second charge basis, provided it covers the required loan amount. If the loan is given for purchasing a computer, the computer has to be hypothecated to the bank.

Holiday Period :

6 months after getting the job or 12 months after completion of the course, whichever is earlier

Repayment :

Repay the loan in equal monthly Instalments for a maximum period of 5 - 7 years, excluding holiday period

Indian Overseas Bank Education Loan Key Features:

1. Loan Amount: IOB provides education loans covering various expenses, including tuition fees, books, hostel fees, exam fees, and other educational-related costs. The loan amount can go up to Rs. 30 lakhs for studies in India and up to Rs. 40 lakhs for studies abroad, depending on the course and institution.

2. Flexible Repayment: The bank offers flexible repayment options, allowing students to repay the loan after completing the course or after getting a job, providing a grace period.

3. Collateral and Margin: IOB education loans for studies in India up to Rs. 7.5 lakhs are generally collateral-free. Tangible collateral, such as property or fixed deposits, may be required for loans above this limit. The margin requirement is 5% for loans up to Rs. 4 lakhs and 15% for loans above Rs. 4 lakhs.

4. Moratorium Period: IOB provides a moratorium period that covers the duration of the course plus an additional grace period. This ensures that students can focus on their studies without worrying about loan repayments immediately.

Eligibility of IOB Education Loan:

To be eligible for an Indian Overseas Bank Education Loan, the applicant must fulfill the following criteria:

1. Indian citizen

2. Secured admission to a recognized institution in India or abroad

3. Good academic record

4. Proof of admission, such as the admission letter from the educational institution

Documents Required for IOB Education Loan:

1. Proof of Identity: Aadhaar card, PAN card, Passport, Voter ID, etc.

2. Proof of Address: Aadhaar card, Utility bill, Rental agreement, etc.

3. Proof of Admission: Admission letter from the educational institution

4. Academic Records: Mark sheets, certificates, and other academic documents

5. Income Proof: Salary slips, income tax returns, bank statements, etc., of the parent/guardian

6. Collateral Documents: Property documents, fixed deposit receipts, etc., if applicable

IOB Education Loan FAQs:

Q1. Can I apply for an education loan before securing admission?

A: You can apply for an education loan before securing admission. However, the loan will only be sanctioned upon providing proof of entry.

Q2. Can I get a loan to study abroad?

A: IOB provides education loans for studying in India and abroad, subject to meeting the eligibility criteria.

Q3. What is the repayment period for an education loan?

A: The repayment period for IOB education loans is generally between 5 to 7 years, but it can vary depending on the loan amount and other factors.

Q4. What happens if I fail to repay the loan on time?

A: Defaulting on loan repayments can have serious consequences, including legal action and a negative impact on your credit score. It is essential to make timely repayments to avoid such effects.

Q5. Can I avail of an education loan without collateral?

A: IOB offers collateral-free education loans up to a certain loan amount. However, tangible collateral may be required for loans exceeding the specified limit.

Q6. Is there any age limit for applying for an education loan?

A: There is no specific age limit for applying for an education loan. However, the bank may consider the course duration and the applicant's repayment capacity while evaluating the loan application.


The Indian Overseas Bank Education Loan is a valuable financial resource for aspiring higher-education students. With competitive interest rates, flexible repayment options, and a focus on supporting academic excellence, IOB ensures that financial constraints do not hinder your educational dreams. By offering collateral-free loans, a wide range of loan amounts, and a grace period for repayment, IOB aims to make education accessible to all. If you're ready to embark on your educational journey, the Indian Overseas Bank Education Loan could be the stepping stone you need to reach your goals. Contact your nearest IOB branch or visit their website for more information and take the first step towards realizing your educational aspirations.

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