Vidya Lakshmi is a government-run portal that helps students easily find and apply for education loans. It makes the loan process clear and accessible. The portal is managed by NSDL e-Governance Infrastructure Limited and supported by the Indian Banks Association, the Department of Higher Education, and the Department of Financial Services.
Students can use Vidya Lakshmi to apply for loans, track their applications, and explore various loan options. This guide covers everything you need to know about Vidya Lakshmi’s loan interest rates, features, tax benefits, and application tips.
- Key Features of Vidya Lakshmi Education Loan
- Understanding MCLR (Marginal Cost of Funds-Based Lending Rate)
- Vidya Lakshmi Education Loan Interest Rates by Bank
- Tax Benefits on Vidya Lakshmi Education Loan Interest
- Steps to Claim Income Tax Deduction on Education Loan
- Tips for Applying for Vidya Lakshmi Education Loan
- Frequently Asked Questions (FAQs)
- Conclusion
Key Features of Vidya Lakshmi Education Loan
Interest Rate: Starts at 8.40%, depending on the bank and loan type.
1. Loan Amount Limits:
- Up to INR 4 lakh: No collateral required.
- INR 4 lakh to INR 7.50 lakh: No collateral needed, but parents must co-apply.
- Above INR 7.50 lakh: Collateral and parental co-obligation required.
2. Repayment Period: The loan can be repaid over a maximum of 15 years.
3. Moratorium Period: Repayment starts one year after course completion or six months after securing a job, whichever comes first.
4. Application: Students can apply online via the Vidya Lakshmi portal, with up to three banks at once.
5. Loan Disbursal Time: Typically, the loan is disbursed within 15 days of submitting the application.
6. Tax Benefits: Interest paid on the loan is eligible for a tax deduction under Section 80E.
Understanding MCLR (Marginal Cost of Funds-Based Lending Rate)
The Vidya Lakshmi education loan interest rate is determined by each bank’s Marginal Cost of Funds-Based Lending Rate (MCLR). MCLR is the minimum rate at which a bank can lend money to customers.
Banks then add a percentage (typically between 2% to 6%) on top of the MCLR to set the final interest rate for education loans. This means that interest rates can vary from one bank to another. To find the most affordable loan, students should compare the MCLR rates of different banks before applying.
Vidya Lakshmi Education Loan Interest Rates by Bank
Here’s a list of Vidya Lakshmi education loan interest rates (MCLR) across different banks:
| Bank Name | MCLR (%) |
|---|---|
| Allahabad Bank | 8.65 |
| Andhra Bank | 8.75 |
| Bank of Baroda | 8.65 |
| Bank of India | 8.65 |
| Central Bank of India | 8.65 |
| Dena Bank | 8.80 |
| Punjab National Bank | 8.45 |
| State Bank of India | 8.55 |
| IDBI Bank | 9.05 |
| Axis Bank | 8.90 |
| Yes Bank | 9.70 |
| Bandhan Bank | 10.45 |
Note: MCLR rates change monthly, so it’s essential to check the latest rates.
Tax Benefits on Vidya Lakshmi Education Loan Interest
The Indian government offers tax benefits on the interest paid on education loans under Section 80E of the Income Tax Act. This allows the borrower who is paying the EMI to reduce their taxable income.
- Deduction Period: The tax deduction is available for up to 8 years from the start of repayment.
- Limit: There is no maximum limit on the amount that can be deducted.
- Eligibility: Only the borrower who is paying the EMI can claim this deduction.
- Interest Subsidy: If the borrower claims an interest subsidy, they cannot claim the tax deduction for the same period.
Steps to Claim Income Tax Deduction on Education Loan
- Obtain Interest Certificate: Request an interest payment certificate from your bank, showing the total interest paid on your education loan.
- Report in ITR: When filing your Income Tax Return (ITR), include the interest amount paid under Section 80E to claim the tax deduction.
- Attach Documentation: Along with your ITR, submit the interest certificate and any other relevant documents as proof of the interest paid on the loan.
Tips for Applying for Vidya Lakshmi Education Loan
- Check Updated Interest Rates: MCLR rates change every month. Make sure to check the latest rates before applying to get the best deal.
- Understand the Loan Terms: Each bank may have different policies on interest rates and loan terms depending on the course and institution. Be sure to review these carefully.
- Apply for Subsidies: If you’re eligible for any interest subsidies, apply for them. Subsidies can significantly lower the cost of the loan.
- Use the Tax Benefits: Don’t forget to claim Section 80E tax benefits on the interest paid. This will help reduce your taxable income.
Frequently Asked Questions (FAQs)
The starting interest rate is around 8.40%. However, the actual rate depends on the bank and its MCLR.
Yes, loans up to INR 7.50 lakh do not require collateral, though parental co-application is necessary.
Repayment starts after a one-year moratorium period following the course completion or six months after securing a job.
Yes, you can apply to up to three banks at once via the Vidya Lakshmi portal.
Tax benefits on education loan interest are available under Section 80E. The borrower must obtain an interest payment certificate from their bank and report it in their income tax return.
Conclusion
Vidya Lakshmi is a trusted and user-friendly platform for students looking for financial support for their education. It provides clear details about interest rates, the application process, and repayment terms, helping students plan their education expenses more effectively. Additionally, the tax benefits available on the interest paid reduce the overall financial burden, making Vidya Lakshmi an attractive choice for both students and their families.
