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PNB cuts education loan rates by 20 bps under PM Vidyalaxmi Scheme

PNB has cut interest rates on its Vidyalaxmi education loans by 20 basis points, bringing down rates from 7.7% to 7.5% New Delhi Punjab National Bank (PNB) on Tuesday lowered interest rates on education loans provided through its Vidyalaxmi Scheme by 20 basis points (bps), from 7.7% to 7.5%. "This will make higher education more accessible for Indian students," PNB said in a press release. What is the Vidyalaxmi Scheme? The Vidyalaxmi Scheme is a special education loan product available to Indian nationals, including non-resident Indians (NRIs) and overseas citizens of India (OCIs). It provides collateral-free and guarantor-free loans to students who have secured admission on merit to 860 Quality Higher Education Institutions (QHEIs) across India. PNB has divided these institutions into three groups: Group II (AA): 152 institutes Group III (A): 623 institutes Revised rates The bank's education loan offering is need-based and requires parents or guardians to be joint borrowers. The revised interest rates start at 7.5%, depending on the institute group. The margin remains nil for loans up to Rs 4 lakh for all categories, while for Group III institutions, a 5% margin applies for amounts above that. For students from families with annual incomes up to Rs 4.5 lakh, the scheme includes a 100% interest subvention for technical and professional courses under the PM-USP CSIS, while other courses receive a 3% subvention under PM-Vidyalaxmi. Families with incomes between Rs 4.5 lakh and Rs 8 lakh can access a 3% interest subvention for all courses under PM-Vidyalaxmi. Eligibility and documents To be eligible for this loan, students must be Indian nationals, including NRIs and OCIs. Required documents include: KYC details: Aadhaar, PAN ID and address proof Previous qualifying self-attested mark sheets Entrance exam results Offer letter from the institution and fee structure Passport-size photographs Details of previous or existing loans, if any Proof of family income from a designated public authority Repayment period Parents or guardians must join as co-borrowers. The future income of the student is to be assigned to the bank for loan repayment. The repayment period for these loans is 15 years, excluding the moratorium period, which covers the course duration plus one year.