State Bank of India Education Loan Repayment: Complete Guide

The journey to university is a significant milestone that requires thoughtful budgeting and investment. The State Bank of India (SBI) offers a variety of education loan options for aspiring students. While an SBI Education Loan makes higher education more accessible, but many people face challenges during the repayment phase. Planning for the future and keeping a high credit score depend on knowing the repayment of education loan in SBI. In this blog, we will explore the SBI education loan repayment procedure.

Key Features of SBI Education Loan

Process of Repayment of Education Loan in SBI

Applicants often wonder how to pay SBI education loan online. However, paying back your SBI education loan is very simple. The key to a hassle-free experience is understanding your SBI education loan repayment options thoroughly. This guide will provide you with the information you need to confidently manage your SBI student loan repayment.

Equated Monthly Installments (EMIs):

After completing your studies, you will start making monthly installment payments, known as EMIs, to repay your loan. SBI offers various education loan programs that allow you to extend your SBI student loan repayment period up to a maximum of 15 years. Your EMI will cover both the principal and interest, making it an easy way to manage your loan repayment over time.

Moratorium Period: Interest Payment Options:

SBI provides a grace period for its student loans. There is a grace period during which EMI payments are not required. It extends for the length of your course plus an extra six to twelve months, allowing you time to secure employment.

Paying Interest During the Moratorium:

The interest that accrues during your study period and moratorium may be paid, though it is not required. By paying off this interest sooner rather than later, you can lower your EMI amount because, after the moratorium, your payments will only be based on the principal.

What are the Ways to Pay Your SBI Education Loan?

Understanding that each borrower has different needs and financial circumstances, There are huge range of State Bank of India education loan repayment options available for you that are designed to help you repay your education loan with ease and effectiveness. SBI education loan repayment rules are simple and easy to understand and guarantee you a seamless loan repayment experience customized to suit your needs.

Online Payment:

You can use the SBI education loan prepayment calculator also as SBI offers an online loan repayment portal to help you repay your loan with ease. The EMI can be transferred straight from your savings or current account to your loan account using SBI's net banking service.

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  Log in to your SBI net banking account.
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  Navigate to the ‘Transfers’ section and select your education loan account.
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  Enter the EMI amount and confirm the payment.

Automatic Payment:

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  National Automated Clearing House (NACH): A feature that enables debtors to automatically deduct their installment payments from their bank accounts. NACH is efficient because it doesn't require human intervention to guarantee on-time payments.

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  Electronic Clearance Services (ECS): Like NACH, ECS enables smooth EMI withdrawals from the borrower's bank account, offering a dependable and automatic means of meeting loan obligations.

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  E-NACH (Electronic National Automated Clearing House): e-NACH is a system that improves on the conventional NACH system by introducing a digital mandate system that makes setting up automatic payments easier. This online authorization that works without paper can be easily set up through your bank, making it a convenient and environmentally friendly way to start and manage your loan repayments.

These automated methods ensure timely payments without the need to remember due dates, offering a worry-free repayment experience.

Manual Payment:

Every month, you can also manually pay your bills at any SBI branch by cheque or cash deposit. When making the payment, be sure to include your loan account number accurately.

SBI YONO App: If you have an SBI account, you can pay your student loan with the YONO app. The loan management and payment interface offered by the app is easy to use.

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  Download the SBI YONO app and log in.
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  Navigate to the ‘Loans’ section and select your education loan.
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  Follow the prompts to make the payment.

Secure your higher education with SBI! Watch our video to learn how to easily get an education loan.

Benefits of Starting Early Repayment of SBI Student Loan

SBI education loan prepayment or starting your EMIs during the moratorium period can significantly reduce the total interest accrued, offering substantial savings. Moreover, under Section 80E of the Income Tax Act, you can avail tax benefits for the interest paid on your education loan, further reducing your financial burden. Let us understand some additional benefits of repaying your education loan early at SBI.

Rules and Regulations for SBI Education Loan Repayment

Understanding the rules for repaying your State Bank of India (SBI) education loan can help you manage your loan effectively. 

Repayment Tenure:

The repayment period is based on the amount you have borrowed, if your loan is up to INR 7.5 Lakhs, you have a maximum of 10 years to repay. For loans exceeding INR 7.5 Lakhs, you have up to 15 years to pay it off.

Moratorium Period:

You have some time before you actually start repaying your education loan. The moratorium includes the duration of your course plus an additional 6–12 months after you finish your studies. Repayments begin once this period is over.

Interest During Moratorium:

Interest will accumulate during the moratorium, but there's no need to worry as public sector banks like SBI don’t require you to make payments at this stage. However, paying it off early can help lessen your overall financial burden.

Repayment Options:

You can choose from convenient repayment methods such as ECS (Electronic Clearing System), standing instructions (auto-debit), or even post-dated cheques. Select the option that suits you best.

No Prepayment Charges:

Have some extra cash? You can prepay your loan at any time without the fear of penalties. Whether you want to pay a little or the full amount, you have the freedom to settle it ahead of schedule. Borrowers can repay the loan early without penalties.

Also, Know the Disbursement process of SBI education loan.

Repaying an SBI education loan is a journey that requires careful planning, methodical execution, and knowledge of your options. Borrowers can achieve financial independence and fulfill their educational goals without jeopardizing their financial security by following the instructions provided in this extensive guide.

Even though the SBI's extensive loan services offer a solid foundation for funding your higher education, sorting through the countless details of loan repayment can still be challenging. At this point, GyanDhan becomes an indispensable ally in helping you make informed decisions regarding your student loan. Serving as a guiding light for students navigating the financial intricacies of pursuing higher education, we make sure that their journey is prosperous and long-lasting.

Frequently Asked Questions