Pursuing an engineering degree in India can be a significant financial investment and education loans provide a viable solution for students seeking financial assistance. In 2025, numerous banks and financial institutions continue to offer education loans tailored for engineering aspirants, covering tuition fees, living expenses and other academic costs. With competitive interest rates, flexible repayment options and government-backed subsidies, these loans help students access quality education without financial constraints. Understanding the eligibility criteria, loan terms and repayment policies is crucial for making an informed decision and securing the right financial support for a successful academic journey.
Engineering Education Loan – At a Glance
An engineering education loan is a sum of money borrowed to finance higher education-related expenses while pursuing a BTech or BE degree. These loans cover the cost of tuition, books & supplies, and living expenses while the student is in the process of pursuing a degree. Listed down are the important points to note regarding engineering education loans.
- Indian students between the ages of 16 years and 35 years can avail an education loan from a registered lender.
- These can be for pursuing graduate, post graduate, or diploma courses in several engineering branches.
- To do so, the applicant must have a confirmed admission (with document proof) in a university or a college recognized by the UGC, AICTE, and other such boards.
- The applicant must apply for an education loan with a co-applicant. The co-applicant can be a parent, guardian or spouse in case the applicant is married.
- Interest rate is low if the amount is less than INR 4 lakh. Interest rates increase with the amount being borrowed.
- Also, the education loan interest rate will vary as per the bank and is subject to frequent changes.
- Many banks offer concessions in interest rates for female students who have secured admission to recognized engineering colleges.
- Most banks also do not demand security for education loan amounts up to INR 4 lakh. However, for amounts in the range of INR 10 lakh to INR 30 lakh and above, documents of assets like gold and houses can be pledged as security.
Who Provides Education Loan for Engineering in India?
Only public and private banks have the permission to provide an education loan for engineering in India. Here is a basic breakdown of a few banks that provide loans and their loan processing fees:
| Bank Name | Loan Scheme | Loan amount | Interest Rate | Moratorium Period |
| State Bank of India (SBI) | SBI Scholar Loan Scheme (for premier colleges like IITs, NITs, IIITs) | Up to ₹40 lakh | 8.15% to 8.90% | Course duration + 1 year |
| Punjab National Bank (PNB) | PNB Saraswati Education Loan | Up to ₹10 lakh | 9.55% – 11.80% | Course duration + 1 year |
| Bank of Baroda | Baroda Vidya & Baroda Gyan Loan | Up to ₹20 lakh | 9.85% – 10.50% | Course duration + 6 months |
| ICICI Bank | ICICI Education Loan (for engineering and technical courses) | Up to ₹50 lakh | 10.25%+ | Course duration + 6 months |
| HDFC Credila | HDFC Credila Education Loan (for technical & professional courses) | No upper limit | 10.75% – 12.50% | Course duration + 1 year |
Eligibility Criteria for Education Loans for Engineering Students
To qualify for education loans for engineering students, students must meet specific eligibility criteria set by banks and financial institutions. Here’s an overview of the key requirements.
| Details | Eligibility |
| Nationality | Indian |
| Age | Between 16 to 35 years. |
| Admission Status | Secured admission in a recognized engineering college in India or abroad. |
| Qualification | Pursuing graduate, postgraduate or diploma courses in engineering. |
| Courses | B.Tech, BE and other engineering courses. |
Documents Required for Engineering Education Loans
Here are the mandatory documents that a student needs to provide while applying for an engineering student loan:
- Duly filled and signed application form
- 2 passport size photographs
- Mark sheets of Class 10 and Class 12
- Statement of cost of study
- Aadhaar card (of student and parent/guardian)
- Pan card (of student and parent/guardian)
- Voter ID/Driving License/Passport (optional)
- Residence proof
- Income proof
How to Apply for Engineering Education Loans in India?
Students can apply for the engineering education loan by following the steps given below:
- Visit the bank’s website from where the loan has to be borrowed.
- Click on the new loan application option.
- Fill up the form.
- Provide all mandatory details.
- Attach all required documents (including signature).
- Complete the application.
- The bank will then contact the applicant for all further procedures and verifications.
Do’s and Don’ts for while taking an Education Loan for Engineering
Do’s:
- Take a loan only when absolutely necessary. If one can complete their education just on scholarship aid, one must absolutely do so as there is no requirement to pay the scholarship back.
- Consider how much salary one can expect to earn after the course is completed. This will help the candidate estimate how much EMI he/she will be able to manage per month.
- Do due diligence (as stated in the preceding section).
- Calculate the EMI much in advance. Each bank has its own EMI calculator – use that.
Don’ts:
- Take a loan just because it is available. The pressure of a student loan and the mounting expectation from parents/family members often makes college life difficult.
- Say yes to any interest rate or EMI. Do market research first.
- Take top-up loans*.
FAQs
Q. Are there any charges or fees associated with engineering education loans?
Yes! Most banks either charge a fixed amount or a percentage of the loan amount as processing fee.
Q. What is a repayment period?
The repayment mostly begins six months to one year (depending on the bank) after the candidate completes the course and gets a job.
Q. Is collateral required for securing an education loan?
Collateral requirements vary based on the loan amount. Up to ₹4 lakh, no collateral or third-party guarantee is required. Between ₹4 lakh to ₹7.5 lakh, third-party guarantee may be required. Above ₹7.5 lakh, Collateral is typically required, such as property documents, fixed deposits, or other tangible assets.
Q. Are there any tax benefits on education loans?
Yes, under Section 80E of the Income Tax Act, the interest paid on an education loan is eligible for tax deduction. This benefit is available for a maximum of 8 years or until the interest is fully repaid, whichever is earlier.
Q. What is covered under engineering education loans?
An engineering loan majorly covers the following expenses of the engineering degree:
- Tuition Fee
- Semester Exam Fee
- Library Fee or Project Costs
- Donation Fund
- Annual Fee
- Boarding Charges
- Stationary Charges
- Other Education-Related Costs