Took a loan for your son/daughters higher education in 2009-10 from SBI? Now you can claim Interest subsidy from your loan branch if your total household income is less than Rs.4.5 lakhs per annum. This is a part of Union Government’s HR Department to lend education loans for lesser interest rate.
To claim your interest subsidy, you’ve to obtain an income certificate from Tahasildar (MRO) or appropriate authority and approach your loan branch with loan documents. Note that this only applies to loan taken for children’s higher education in technical or professional courses only.
Claims that are received before 15 March 2011 will get preference in processing (faster approval of interest subsidy).
Note: This scheme was introduced in 2009 by the Central Government and is still in force. Various subsidy claims have been processed in the academic years of 2009-10, 2010-11, 2011-12.
Things you will need
Original income certificate of family (this should not exceed Rs.4.5 lakhs per year)
Interest subsidy form
Bonafide letter issued by the College/Institution where the student is currently pursuing his/her education
And another form (issued by the bank) which asks about the course of study and your personal details.
This scheme can also be availed at most Public Sector banks and most top level Private banks (such as ICICI Bank, HDFC Bank and Axis Bank).
Few important points to note
- This is a one time subsidy which will be available in the first year of the course (either Bachelor’s or Masters). This is also applicable for students who enrolled for integrated courses (such as 5 year bachelors plus masters).
- The subsidy on interest rate will cease and normal education loan rates will be applicable after 1 year of the course completion, or 6 months after one gets a job (which ever occurs first).
- For loans that are sanctioned before 1 April 2009, subsidy will only be applicable for the amount which is released after 1 April 2009.
If you have any questions please ask below in the comments (but please don’t ask ‘what is the procedure?’, it is already explained).