Mumbai, April 28: The country's largest lender, State Bank of India (SBI), on Tuesday said that it has lowered interest rates on education loans by up to 250 basis points, for a limited period.
Interest rates on educations loans, which are linked to
the bank's prime lending rate (PLR), up to Rs 4 lakh will be
reduced to 11.5 per cent from 11.75 per cent, SBI said in
statement while for the Rs 4 lakh-Rs 7.50 lakh loan bracket,
the interest has been slashed to 11.25 per cent from 13.25 per
cent, SBI said in a statement today.
At present, SBI's PLR stands at 12.25 per cent per annum.
For loans of Rs 7.5-lakh and above, interest rate has
been reduced by 1.25 per cent, from 12.25 per cent to 11 per
cent. Girl students will get a further concession of 0.50 per
cent in interest, the statement said.
The lowered rates would be applicable for loans
sanctioned during May-September 2009, while for existing
loans, the extant rates would continue, the release said.
SBI extends loans up to Rs 10 lakh for studies in India
and Rs 20 lakh for abroad. During moratorium/repayment
holiday, simple interest rate is charged.
A further concession of one per cent in interest rate is
given for promptly servicing the interest during
moratorium/repayment holiday. A repayment period of 5-7 years
is given after moratorium, the bank said.
The state-run lender offers collateral-free loans up to
Rs four lakh to students. Third-party guarantee or other
collateral is required only if the loan amount is higher than
Rs four lakh.
SBI has been the market leader in extending loans to
students for pursuing higher studies in India and abroad.
Loan limits aggregating Rs 2,653 crore were sanctioned
during the period from April 2008 to March 2009, the statement
said.
Bureau Report
First Published: Tuesday, April 28, 2009, 00:00