In this post, let’s look at a few education loan products from Punjab National Bank. We will compare four education loan products from PNB.
- PNB Saraswati (For higher education in India)
- PNB Pratibha (For admission to premier institutes such as IITs/IIMs/AIIMS)
- PNB Udaan (For higher education abroad)
- PNB Kaushal (For pursuing vocational education and training)
#1 PNB Saraswati (Higher Education in India)
This loan product is for higher study in India.
Eligibility
- You must be an Indian national.
- You must have secured admission through an entrance exam or a through a merit based selection process.
- Admissions under management quota can be considered.
Permitted Courses
- Approved courses leading to Graduate/ Post Graduate degree and PG Diplomas conducted by recognized colleges/ universities recognized by UGC / Govt. / AICTE / AIBMS / ICMR etc.
- Courses like ICWA, CA, CFA etc.
- Courses conducted by IIMs, IITs, IISc, XLRI. NIFT, NID etc.
- Regular Degree/Diploma courses like Aeronautical, Pilot Training, Shipping, Nursing or any other discipline approved by Director General of Civil Aviation/Shipping/Indian Nursing Council or any other regulatory body as the case may be.
- Advance Diploma in Banking Technology offered by PNB IIT Lucknow.
- Approved courses offered in India by reputed foreign universities.
- Research Programmes recognized by designated academic authority / regulatory body.
Expenses Covered
- Fees payable to college / school / hostel.
- Examination / Library / Laboratory fee.
- Purchase of books / equipment / instruments / uniforms / computer.
- Travel expenses / passage money for studies abroad.
- Life Insurance premium for student borrower, if applicable.
- Caution deposit, Building fund / refundable deposit supported by Institution bills / receipts.
- Any other expense required to complete the course – like study tours, project work, thesis, etc.
Maximum Loan Amount, Margin and Security
There is no clear mention of the maximum loan amount. As I understand, the bank may take a call based on the courses/university and the repayment capacity of the borrower/co-borrower and the guarantor, if any. The earning potential post completion of the course may also be considered.
For loans up to Rs 4 lacs, you do not need to provide any margin. For loans above Rs 4 lacs, you need to provide 15% margin. Any scholarship/assistantship shall also be considered as margin. Margin does not have to be brought in lumpsum. It can be brought in as and when disbursement are made.
For loans up to Rs 7.5 lacs, there is no need for tangible security. Your parent/guardian can be made joint borrower in the loan and that should suffice. However, if the loan value exceeds Rs 7.5 lacs, you will have to provide tangible security to bank’s satisfaction.
Repayment Period and Moratorium
The loan can be repaid in up to 15 years. You can enjoy moratorium till one year after the end of the course. There is no prepayment penalty.
For more on PNB Saraswati Loan Scheme, visit the product page of PNB website.
#2 PNB Pratibha (for Admission to Premier Institutions in India)
You can apply for loan under this scheme if you get admission into a premier institute in India.
Eligibility
- You must be an Indian national.
- You must have secured admission into regular degree/diploma course in a premier institute.
Expenses Covered
Same as PNB Saraswati loan.
Maximum Loan Amount, Margin and Security
The maximum loan amount varies from Rs 15 lacs to Rs 35 lacs depending on the institute/university. The repayment capacity of the borrower/co-borrower/guarantor and the earning potential post completion of the course may also be considered.
For institutes/universities mentioned in Annexure-I, no margin is required.
For other eligible institutes, for loans up to Rs 4 lacs, you do not need to provide any margin. For loans above Rs 4 lacs, you need to provide 5% margin (this was 15% in PNB Saraswati loan). Any scholarship/assistantship shall also be considered as margin. Margin does not have to be brought in lumpsum. It can be brought in as and when disbursements are made.
There is no need for tangible security (irrespective of the loan amount). Your parent/guardian can be made joint borrower in the loan and that should suffice.
Repayment Period and Moratorium
The loan can be repaid in up to 15 years. You can enjoy moratorium till one year after the end of the course. There is no prepayment penalty.
For more on PNB Pratibha Loan Scheme, visit the product page on PNB website.
Note: For admission to premier institute, you could have applied under PNB Saraswati scheme too. However, the margin and security conditions are much relaxed under PNB Pratibha. Though it is not mentioned, I believe the maximum loan amount is also higher under PNB Pratibha scheme. Additionally, as we would see later, the interest rate are also lower for PNB Pratibha Scheme.
#3 PNB Udaan (for Pursuing Higher Education Abroad)
You can avail this loan for pursuing higher education abroad with premier foreign universities and education institutes.
Eligibility
- You must be an Indian national.
- You must have secured admission through an entrance exam or a through a merit based selection process.
Permitted Courses
- Graduation: For job oriented professional/technical courses offered by reputed universities.
- Post graduation: MCA, MBA, MS, etc.
- Courses conducted by CIMA – London, CPA in USA etc.
- Degree/Diploma courses like aeronautical, pilot training, shipping etc. provided these are recognized by competent regulatory bodies abroad for the purpose of employment.
The bank may consider loan sanction for diploma and certificate courses other than those mentioned above provided you can arrange liquid security (NSCs, Fixed deposits, life insurance policies) of 125% of the loan amount.
Expenses Covered
- Same as for PNB Saraswati Loan.
- In addition, travel expenses / passage money for studies abroad are covered.
Maximum Loan Amount, Margin and Security/Repayment Tenure/Moratorium
Same as for PNB Saraswati loan.
For more on PNB Udaan Loan Scheme, visit the product page on PNB website.
#4 PNB Kaushal (for Vocational Education and Training)
This loan product is for higher study in India.
Eligibility
- You must be an Indian national.
- Admission in course run by ITIs, Polytechnics or in a school recognized by Central/State education Boards/a college affiliated to recognized university/ training partners affiliated to National Skill Development Corporation (NSDC)/Sector Skill Councils, State Skill Mission, State Skill Corporation, preferably leading to a certificate / diploma / degree issued by such organization as per National Skill Qualification Framework (NSQF).
Expenses Covered
- Tuition / course fee.
- Examination / Library / Laboratory fee.
- Caution deposit.
- Purchase of books, equipment and instruments.
- Any other reasonable expenditure found necessary for completion of the course.
Maximum Loan Amount, Margin and Security
Minimum loan amount is Rs 50,000 while the maximum loan amount is Rs 1.5 lacs.
There is no need for any margin or security. Only the parent/guardian needs to be sign up as joint borrower.
Repayment Period and Moratorium
The repayment period depends on the loan amount.
- For Loans <= Rs. 50,000: Up to 3 years
- For loans between Rs 50,000 and Rs 1 lac: Up to 5 years
- For loans above Rs 1 lac (and up to R 1.5 lacs): Up to 7 years
Moratorium depends on the duration of the course. For course duration up to 12 months, the repayment starts 6 months after the end of the course. In other cases, the repayment starts 12 months after the completion of the course. There is no prepayment penalty.
For more on PNB Kaushal Loan Scheme, visit the product page of PNB website.
What Is the Rate of Interest for These Loan Products?
You can check the latest interest rates for various schemes on PNB website. As you would expect, the rates are lower for PNB Pratibha loan scheme because the loan is for admission to reputed institutes. There is an additional discount to children of PNB employees.
Brief Comparison of the 4 Loan Products from PNB
| Loan Scheme | PNB Saraswati | PNB Pratibha | PNB Udaan | PNB Kaushal |
| Purpose/Admission | Higher education in India | Premier Institutes in India | Education abroad | Vocational education and training |
| Maximum Loan Amount | Not specified. Should be less than PNB Pratibha | Rs. 15 to 35 lacs | Not specified | Upto 1.5 lacs |
| Repayment Tenure | Upto 15 years | Upto 7 years | ||
| Moratorium | 1 year from the completion of course | 6 to 12 months | ||
| Margin | 15% for loans > Rs. 4 lacs | Nil for the Best institutes, 5% for loans > Rs. 4 lacs | 15% for loans > Rs. 4 lacs | Nil |
| Security | Above Rs 7.5 lacs | Not required | Above Rs 7.5 lacs | Not required |