Union Bank Education Loan

Union Bank Education Loan

Union bank has started union education scheme for providing education loan to students who studies in India and abroad to help them in building their career.

Loan available for:

  • Basic education
  • To pursue graduation / higher education
  • To pursue technical / professional / management courses

Eligibility criteria and courses available:

  • Should be Indian citizen
  • Must have Secured admission to the concerned institute in India or abroad through appropriate selection process and cleared the qualifying examination, if any
  • Courses covered in India
  • Graduate degree  / PG / diploma courses from recognized universities
  • Technical / professional / management courses
  • Graduation / post-graduation degrees offered by recognized universities
  • Certified degree courses conducted by CIMA, London, CPA, USA and other such institutes
  • Diploma courses abroad are not covered
  • Courses covered outside India

Amount of loan:

  • Student who studies in India - maximum upto Rs. 10 Lakhs. The quantum of loan is higher for the institutes covered under Special Education Loan schemes.
  • Student who studies outside India- maximum Up to Rs. 20 Lakhs.

Allowed margin:

  • loans upto Rs. 4 Lakhs-no margin is required
  • loans above Rs. 4 Lakhs- margin is 5% for studies in India and 15% for studies outside India
  • Scholarship / assistantship will be included in the margin

Reimbursement period:

  • The repayment period is
  • Course period + 1 year
  • Course period + 6 months after commencement of job

Quantum of loan

Maximum repayment tenure (after the course & moratorium period)

Upto Rs 7.50 Lakh

10 years

Above Rs 7.50 Lakh

15 years

Rate of interest:

  • In case of interest is regularly serviced during the course and moratorium period, i.e. prior to the commencement of repayment, then the student is eligible for interest rebate during repayment period. Please contact the nearest branch for details
  • Processing charges are nil.

Required security:

Quantum of loan


Upto Rs 4 Lakh

No security is required.

Above Rs 4 Lakh & upto Rs 7.50 Lakh

Suitable third party guarantee acceptable to the bank to be taken.

Above Rs 7.50 Lakh

Tangible collateral security of minimum value equivalent to the loan amount and interest accumulation during course & moratorium period, acceptable to the bank.

In all the above cases, parent/spouse/parent-in-laws have to necessarily join in as co-applicant


Life insurance of the student is recommended for applying the loan.

Terms and conditions:

  • The loan shall be sanctioned / disbursed from the branch nearest to the place of domicile of the student
  • Loan would be disbursed directly to the institute
  • Loan can be availed during subsequent years of the course
  • Legal and valuation charges have to be borne by the borrowers.
  • If the loan is take-over by other bank/FI, then a charge of 2% on the average loan outstanding for the past 12 months will be levied

Interest subsidy scheme of central government:

The Ministry of HRD has launched Central Government scheme of Interest Subsidy on educational loans for economically weaker sections of the society. 

The students who satisfy all the following parameters would be eligible for the interest subsidy.

  • The student has secured admission to any of the approved courses after Class XII in Technical and Professional streams from recognized institutes in India only and availed educational loan from any of the scheduled banks, including Union Bank of India, to pursue the course.
  • The student belongs to Economically Weaker Section (EWS) with an annual gross parental / family income from all sources not exceeding Rs 4.50 Lakhs. 

    The other features of the scheme are as follow :
  • Subsidy for loan amount upto Rs 10 Lakhs (even if loan is more than Rs 10 Lakhs).
  • Student to submit proof of income from the competent authority appointed by the state government.
  • Scheme applicable for disbursements from the academic year 2016 (even if the loan was sanctioned earlier).
  • Subsidy for the course and moratorium period only.
  • Student will be eligible for interest subsidy only once either for the first undergraduate degree course or the post graduate degree / diploma course in India.

Important: The eligible students should contact bank branches from where they have availed / availing educational loans for further details.

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