To improve the literacy ratio, the Government of India launched the Padho Pardesh scheme that came into effect from 1 st April 2013. The scheme provides subsidised education loans to aspiring students with a family income of up to Rs.6 Lakh per annum.

To avail advances under the latest Padho Pardesh scheme, applicants should belong to the economically weaker section or minority sections of the society. Besides, you will have to meet the following eligibility criteria to avail a 100% subsidy under this plan:

1. Students should not have discontinued their course mid-way or should not have been expelled from the institution under any academic or disciplinary ground.
2. Applicants should be a resident of India and should not have given up Indian citizenship under any ground throughout this Padho Pardesh scheme loan tenure.
3. Students can avail this subsidised education loan only once at the time of pursuing higher education.
4. Candidates must avail such advances from financial institutions that are linked with the education loan under this scheme.
5. This scheme aims to provide the required finances to study abroad. The interest allowance will be linked with the IBA education loan scheme and is restricted to pursuing higher education like Masters, PhD or M.Phil.
6. Candidates should have secured admission in an institution abroad with the mentioned courses or any other courses accepted under this scheme.
7. The loan can be availed within the first year of a course.

Benefits of this Scheme

1. Under this scheme, you can avail a prolonged repayment tenure. You can enjoy a moratorium period, which is your course period along with an additional one year or six months after securing employment, whichever is earlier.
2. The moratorium period provided allows you to pay back your loan after you have secured a job which does not strain your budget at the time of pursuing your higher education.
3. At the time of your moratorium period, the interest incurred will be borne by the Government of India. After your moratorium period ends, you will have to only make payments towards the interest rates calculated on the outstanding balance.
4. The interest rate at which loans are approved is subsidised which reduces the cost of your loan. This subsidised interest rate plays a significant role and helps you to manage your finances better while studying abroad without straining your budget.

Application process

To avail the advantages of this scheme, you will have to apply for a loan from your preferred lender. The padho pardesh scheme process is quite simple and easy. Fill up the Padho Pardesh application form with the required details. Submit all the necessary documents and meet the eligibility criteria. After you complete all the formalities, your lender will update your details on the portal of this scheme. You can also track the status of your application by logging into the official portal.

Alternatively, if you do not qualify for education loan subsidy under this Padho Pardesh scheme, you can avail secured advances like loan against property on education. Under such credits, you have to mortgage an asset to secure the financing.

While you avail such advances, do make sure to check the charges on your loan against property for education to estimate the cost of your loan. Inquire on the interest rates and other applicable fees like part-prepayment charges, foreclosure charges, etc.

Several financial institutions and NBFCs offer such advances with zero part-prepayment and foreclosure charges. Bajaj Finserv is one such NBFC that provides Loans Against Property for Education at an attractive interest rate against minimal documents.

This NBFC also brings you pre-approved offers that aim to reduce the hassle of the application process and save your time. These pre-approved offers are available on multiple financial products such as home loans, business loans, personal loans, etc.

Besides the above, while you avail student education loan on a property, do make sure to claim the income tax benefits. Under Section 80E, you can claim deduction on the entire loan interest paid for up to 8 years.