Education Loan Disbursement Process, EXPLAINED!

Posted In education loan On March 22, 2019
image

Student loan plays a significant role by helping to bridge the gap between the deficit and the required amount. Student loan disbursement process starts as soon as the loan is granted by the bank. Disbursing money is a part of the cash flow.

Process for Education loan disbursement:

  1. Firstly, pay the processing fees of the bank from which the student loan is sanctioned.

  2. The bank will provide a sanction letter to the borrower. This letter will act as proof of funds for the student. For students taking admission abroad, this letter can be a requirement during the issue of visa.

  3. Next, the bank signs an agreement with mutual consent from the borrower and co-borrower. During this agreement, the bank asks for the course fee payment structure and payment due dates of the college.

  4. The bank then verifies the details provided by the borrower. This process is completed within a week by the bank.

  5. The student loan is finally disbursed within 2 days after the verification.

In India, between 2013-14 and 2015-16, Public Sector & Private Sector banks extended educational loans amounting to Rs 25736 crore to 21.79 lakh beneficiaries as per the data shared by the government in the Rajya Sabha.
Like it? Share it!