Education Loan

Cooperative Bank Education Loan: Benefits, Eligibility, Requirements and More

Cooperative Bank Education Loan: Benefits, Eligibility, Requirements and More

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Explore the financial backing of cooperative bank education loan by knowing their maximum loan amount, eligibility, application process, and more.

GyanDhan
Rohit Gidwani
Updated on:  26 Apr 2024  | Reviewed By: 
Aman 
| 158 | 6  min read

Facing the steep cost of education can feel like hitting a roadblock on your journey to higher learning. But there's a way around it: Cooperative Bank Education Loans. This guide shines a light on how these loans open doors for students, breaking down financial barriers with ease. From Saraswat Co-operative Bank to Cosmos and beyond, we'll cover what you need to know—from how much you can borrow to the simple steps to apply. If you're aiming for higher education, either close to home or abroad, dive into the essentials of Cooperative Bank Education Loans with us. It's your first step toward making those educational dreams come true, without the worry of financial strain.

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What is Cooperative Bank Education Loan?

Cooperative banks in India are critical financial institutions that operate on the principles of mutual assistance and community-oriented banking. These banks are pivotal in fostering inclusive finance, providing credit and banking services to rural and semi-urban areas, where traditional banking may have limited reach. They play a significant role in the economic development of these regions, offering support to small and marginal farmers, micro and small enterprises, and other weaker sections of society. 

Saraswat Co-operative Bank, for example, is one of the leading cooperative banks in India, known for its comprehensive banking solutions and contribution to the cooperative movement. Alongside Saraswat Bank, institutions like Cosmos Co-operative Bank and Shamrao Vithal Co-operative Bank have also made substantial contributions to the sector. These banks are not just financial entities but pillars of community support and development, driving financial inclusion and empowerment across India. Their efforts in providing education loans, such as the Saraswati Education Loan by Saraswat Bank, underscore their commitment to societal advancement.

 

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Maximum Cooperative Bank Education Loan Amount

The maximum loan amount offered by cooperative banks for education loans varies depending on various factors such as the course and country of study, the applicant's academic record, and the collateral offered, among others. These loans are designed to cover tuition fees, living expenses, books, and other necessary expenditures associated with higher education, both domestically and abroad. Here's a brief overview of the maximum education loan amounts offered by some cooperative banks, with Saraswat Co-operative Bank included as an example:

Name of Bank Maximum Loan Amount 

Saraswat Co-operative Bank

Up to Rs. 150 lakhs

Cosmos Co-operative Bank

Up to Rs. 50 lakhs

Shamrao Vithal Co-operative Bank

Up to Rs. 75 lakhs

Abhyudaya Co-operative Bank Ltd

Up to Rs. 30 lakhs

Bharat Co-operative Bank

Up to Rs. 40 lakhs

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Eligibility for Cooperative Bank Education Loan

Education loans from cooperative banks aim to support students in achieving their higher education goals, whether they are pursuing studies domestically or abroad. These loans are designed to ensure that financial constraints do not hinder a student's educational aspirations. While specific eligibility criteria can vary from one cooperative bank to another, there are general guidelines that must follow:

  • list items Applicant's educational background: The student must have secured admission to a professional or technical course in India or abroad through an entrance test or a merit-based selection process.
  • list items Course eligibility: The course for which the loan is sought should be a graduate, postgraduate, or professional course offered by a university or college recognized by the University Grants Commission (UGC), All India Council for Technical Education (AICTE), or any other recognized authority in India or abroad.
  • list items Age limit: Some banks may specify an age limit for applicants, though this can vary.
  • list items Co-applicant requirement: A co-applicant is usually required, which can be a parent, guardian, or spouse (if married). This ensures additional security for the loan.
  • list items Creditworthiness: The credit history of the co-applicant is also considered to assess the repayment capacity of the loan.
  • list items Nationality: The applicant must be an Indian national.

It's essential for students and co-applicants to consult directly with the cooperative bank from which they are considering borrowing to get detailed and up-to-date information on the eligibility criteria, as these can vary based on the bank's policies and the specifics of the education loan program.

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Documents Required for Cooperative Bank Education Loan 

Applying for an education loan from cooperative banks involves submitting a set of documents to prove eligibility, assess creditworthiness, and understand the details of the course and institution where the applicant intends to study. Below is a general list of documents that are commonly required by most cooperative banks for processing an education loan application:

  • list items Duly filled loan application form
  • list items Recent passport-sized photographs
  • list items Photo identity proof (Aadhaar card, passport, driving license, etc.)
  • list items Residence proof (utility bills, Aadhaar card, passport, etc.)
  • list items Academic records (mark sheets and certificates from 10th grade onwards)
  • list items Proof of admission (offer letter from the institution)
  • list items Schedule of expenses for the course
  • list items Bank account statement of the borrower/co-borrower for the last 6 months
  • list items Income proof of the co-borrower (salary slips, income tax returns, bank statements, etc.)
  • list items Assets and liabilities statement of the co-borrower
  • list items If applicable, collateral security documents (such as property documents, fixed deposit receipts, etc.)

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Benefits of Cooperative Bank Education Loan

Education loans from cooperative banks in India offer a pathway for students to pursue their dreams of higher education without being hampered by financial constraints. These loans are tailored to meet the needs of students aspiring for higher studies, both domestically and internationally, ensuring that education remains accessible and affordable for all segments of society. Here are some key benefits of availing education loans from cooperative banks:

  • list items Lower interest rates: Typically, cooperative banks offer education loans at competitive interest rates compared to other financial institutions.
  • list items Subsidy scheme eligibility: Students may be eligible for interest subsidies under government schemes, reducing the financial burden during the study period.
  • list items Flexible repayment options: These loans often come with flexible repayment options, including moratorium periods that allow students to start repayment after completing their education and securing employment.
  • list items Comprehensive coverage: The loans usually cover a wide range of expenses beyond just tuition fees, including books, equipment, hostel fees, and travel expenses for students studying abroad.
  • list items No margin money for loans up to a certain limit: For loans below a specific amount, banks may not require margin money, making education more accessible.
  • list items Tax benefits: Borrowers can avail tax benefits under Section 80E of the Income Tax Act for the interest paid on the education loan, subject to prevailing tax laws.
  • list items Wide course and college coverage: Loans are available for a variety of courses, including undergraduate, postgraduate, vocational, and technical courses, offered by recognized institutions in India and abroad.

Wrapping up, let's keep it simple: getting through the financial maze of higher education is totally doable with a little help from Cooperative Bank Education Loans. Whether it's Saraswat Bank, Cosmos, or any other cooperative gem, there's a plan out there waiting to get you from dreaming about that degree to actually working towards it. And hey, if you're on the hunt for more options or just wanna see if you're hitting the mark with eligibility, why not give GyanDhan a shout? Teaming up with an array of lenders from public to private banks, NBFCs, and even international names, GyanDhan's got your back to help scout out the best loan for your academic adventure. So, why wait? Check your eligibility with GyanDhan and leave the rest to us. 

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Frequently Asked Questions

Can vocational courses be financed through cooperative bank education loans?

Yes, students applying for vocational courses are eligible for education loans from cooperative banks, with certain banks offering up to Rs. 10 lakh for such courses.

What is the maximum loan amount available for studies abroad through cooperative banks?

Cooperative banks offer substantial loan amounts for studies abroad, with some banks providing up to Rs. 150 lakh. Higher limits may be considered on a case-by-case basis.

Are there any concessions on interest rates for girl students in cooperative bank education loans?

Yes, some cooperative banks offer interest rate concessions for girl students. For example, a concession of 0.25% is provided by certain banks, emphasizing their support for girl students' education.

What kind of security is required for loans above Rs. 4 lakh?

For loans above Rs. 4 lakh, cooperative banks generally require collateral security of value equivalent to the loan amount, alongside a parent, guardian, or close relative as a joint borrower.

How long is the repayment period for cooperative bank education loans?

The repayment period varies based on the loan amount. For amounts up to Rs. 4 lakh, the maximum repayment period can be up to 60 months post-moratorium. For higher loan amounts, it can extend up to 180 months, inclusive of the moratorium period

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