Education Loan in India : Loans – How Individuals Borrow - PowerPoint PPT Presentation

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Education Loan in India : Loans – How Individuals Borrow

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Education loan in India are usually very quick in nature (less than a year) and hence no or very less documentation is done. Most of such loans are backed by some sort of collateral, primarily for large amounts. – PowerPoint PPT presentation

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Title: Education Loan in India : Loans – How Individuals Borrow


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Education Loan in India
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Loans How Individuals Borrow
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  • We all take loans at some point of our life, some
    might need money for a new car or a new house and
    some might need it for contingencies and personal
    expenses like travel.
  • Loans have been inevitable part of human society
    since beginning. Any loan starts with two
    parties, a Borrower and a Lender.
  • A person or institution with some extra money
    lends to someone who needs it and in turn
    receives interest on it. Thats how banks work.
  • They serve as intermediaries between lenders and
    borrowers, gathers money from those who have
    extra (savings accounts, current accounts, fixed
    deposits, term deposits) and lends to those who
    require money (personal loans, home loans, auto
    loans, credit cards, overdraft, etc).

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  • Education Loans As name suggests, educational
    loans are for students who wants to pursue higher
    education and dont have money to pay fee.
  • Its a simple process, go to nearby bank and
    provide required documents (mark sheets, call
    letter from an approved institution, fee
    structure and a guarantor) and they will clear
    your loan, however they cover up to 80 of loan
    and rest is to be paid by student.
  • SBI provides Education Loans at 11.75 to 13.50
    based on amount required, PNB provides education
    loan at 11 to 11.75.
  • However there is no collateral required for these
    loans but with collateral banks provide loan at
    preferential rates

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  • For banks and specialised financial institutions,
    education loan is not a small business
    opportunity.
  • With close to Rs 80,000 crore spent on higher
    education every year, about 14 to 15 of the
    students pursuing graduate or post-graduate
    courses opt for such loans.
  • Loans Against Assets Financial institutions also
    provide loans against various assets including
    gold, property, fixed deposits, securities,
    NSCs, bonds, LIC and various other assets which
    possess storage value.
  • Recently Reserve Bank of India said NBFCs can
    use the historical spot gold price data, publicly
    disseminated by a commodity exchange regulated by
    the Forward Markets Commission, for determining
    the loan-to-value (LTV).

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  • Other Loans Apart from these loans Banks
    NBFCs also provide loans for new businesses,
    established businesses, rural loans, overdraft
    facility, loans for professionals (e.g. Doctors),
    career loans, etc.
  • Family and friends can lend you money at as low
    as 0 where as people with immediate need and low
    credit worthiness have seen to borrow money at
    interest rates of as high as 5 monthly or even
    more. Education loan in India are usually very
    quick in nature (less than a year) and hence no
    or very less documentation is done.
  • Most of such loans are backed by some sort of
    collateral, primarily for large amounts.
  • Sourcehttp//smartlending.in/blog/index.php/2015/
    06/12/loans-how-individuals-borrow/

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8
Read more on Education Loans
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