🎓 Education Loan

How to Get Education Loan After 12th in India 2026 — Step by Step Guide

By FinMandi Research Team·June 2026·✓ Updated June 2026

🔍 Reviewed by FinMandi Research Team·✓ Cross-checked against official bank sources·✓ Updated June 2026

⚡ Quick Answer

Any Indian student admitted to a recognised college can get an education loan after 12th
Up to Rs 7.5 lakh without collateral from PSU banks
PM Vidyalaxmi gives 3% interest subsidy for family income below Rs 8 lakh
Apply via vidyalakshmi.co.in — one form, 38+ banks
Interest rate: 8.50%–9.00% p.a. at PSU banks

Who is Eligible for Education Loan After 12th?

Indian citizen who has passed Class 12 (any board)
Secured admission to a recognised college or university in India
Course must be approved — graduation, professional courses (engineering, MBBS, law, CA, management)
A parent or guardian as co-borrower is mandatory
No minimum marks required — admission letter is the key document

Good news: You do NOT need a CIBIL score to apply for education loan after 12th. Students typically have no credit history. Banks evaluate the co-borrower's (parent's) CIBIL score instead.

How Much Loan Can You Get After 12th?

Loan Amount	Collateral Needed	Who Approves
Up to Rs 4 lakh	Nothing — no collateral, no guarantor	All PSU banks
Rs 4 lakh to Rs 7.5 lakh	Third-party guarantor (no property needed)	All PSU banks
Rs 7.5 lakh to Rs 20 lakh	Property, FD or LIC policy	All banks
Above Rs 20 lakh	Tangible collateral mandatory	All banks + NBFCs

Which Banks Give Education Loan After 12th?

Bank	Interest Rate	Max Without Collateral	Special Scheme
SBI	8.65%	Rs 7.5 lakh	SBI Scholar for IIT/NIT
Bank of Baroda	8.70%	Rs 7.5 lakh	Baroda Vidya
Union Bank	8.50%	Rs 7.5 lakh	Vidya Turant — fastest
PNB	8.55%	Rs 7.5 lakh	PNB Udaan
Canara Bank	8.70%	Rs 7.5 lakh	IBA model loan

Documents Required for Education Loan After 12th

Aadhaar card (student + parent)

PAN card (student + parent)

Class 10th and 12th marksheets

Admission letter from college

Fee structure from institution

Parent salary slips (last 3 months)

Parent bank statement (last 6 months)

Income certificate (for PM Vidyalaxmi subsidy)

How to Apply — Step by Step

Get your admission letter firstBanks will not process your loan without a confirmed admission letter from the college.

Visit vidyalakshmi.co.inRegister with your email and Aadhaar-linked mobile. Fill one Common Application Form for all banks.

Apply for PM Vidyalaxmi subsidyIf family income is below Rs 8 lakh/year, apply for 3% interest subsidy on the same portal.

Choose 2–3 banksSelect SBI, Union Bank and Bank of Baroda simultaneously. More applications = better chances.

Visit bank branch with documentsBank contacts you within 15–30 days. Visit with original documents for final verification.

Loan sanctioned and disbursedTuition fees go directly to the college. Living expenses go to your bank account each semester.

What is the Moratorium Period?

You do NOT have to repay the loan while studying. The moratorium period covers your course duration plus 1 year after completing the course (or 6 months after getting a job — whichever is earlier). EMI starts only after this period ends.

💡 Smart tip: Even during moratorium, try to pay just the interest if you can manage. This significantly reduces your total repayment amount and keeps your loan account healthy.

Tax Benefit on Education Loan

Under Section 80E of the Income Tax Act, the entire interest paid on education loan is tax deductible — no maximum limit. This benefit is available for 8 consecutive years from when repayment starts. Your parents can also claim this deduction if they co-borrowed the loan.

📚 Apply at vidyalakshmi.co.in →

PM Vidyalaxmi Complete Guide →Loan Without Collateral

Frequently Asked Questions

No. An admission letter from a recognised college is the most critical document for any education loan. Banks will not even begin processing without it. Get your admission confirmed first, then apply for the loan.

Union Bank Vidya Turant has the fastest digital processing. SBI has the widest branch network. For students at IIT/NIT/AIIMS, SBI Scholar Loan offers the best rate. For most students, apply to 2-3 PSU banks simultaneously on Vidya Lakshmi portal and go with whichever approves first.

Yes. Banks give education loans for management quota admissions too. The loan amount and eligibility criteria are the same. However, management quota fees are often higher, so you may need a larger loan which could require collateral above Rs 7.5 lakh.

If you drop out, the moratorium period ends and repayment begins immediately. The bank may recall the loan. Contact your bank immediately if you plan to drop out — most banks have options to defer repayment if you plan to rejoin education within a year.

⚠️ Disclaimer: All information is for educational purposes only. Rates and scheme details are based on publicly available data as of June 2026 and may change. FinMandi is an independent information platform — not a bank, NBFC, or registered investment adviser. Always verify directly with your bank before making any financial decision.