Education Loan at Zero Interest Rate – Information Document

Education is the foundation of a successful future. To support deserving students who face financial challenges, several institutions, NGOs, and government programs provide Education Loans at Zero Interest Rate (Interest-Free Loans). These loans aim to help students pursue higher education in India or abroad without the burden of interest.

1. Education Loan at Zero Interest Rate – Information
Document
Introduction
Education is the foundation of a successful future. To support deserving students who face financial
challenges, several institutions, NGOs, and government programs provide Education Loans at Zero
Interest Rate (Interest-Free Loans). These loans aim to help students pursue higher education in
India or abroad without the burden of interest.
Objective
The primary goal of this scheme is to:
Provide financial assistance to meritorious and economically weaker students.
Ensure that lack of funds does not stop deserving students from pursuing higher studies.
Encourage education in professional fields such as Medicine, Engineering, Law, Management,
and other degree programs.
Eligibility Criteria
The applicant must be an Indian citizen.
Admission must be secured in a recognized institution in India or abroad.
The annual family income should generally not exceed n4.5 – n6 lakh (varies by scheme).
Preference is given to students from economically weaker or disadvantaged backgrounds.
Loan Details
Particulars Details
Loan Amount Up to n10 – n20 lakhs (depending on the program or institution)
Interest Rate 0% (Interest-Free)
Repayment Period Up to 7–10 years after completion of the course
Moratorium Period Course duration + 6 to 12 months grace period
Collateral Not required in most government or trust-based schemes
Processing Fee Nil or minimal
Required Documents
Completed Loan Application Form
Proof of Admission (Offer Letter/Admission Letter)
Cost Estimate from the Institution
Income Certificate / ITR of Parents or Guardians
ID & Address Proof (Aadhaar, PAN, Passport)
Academic Records (Mark Sheets, Certificates)
Guarantor’s Details (if applicable)
Sources Offering Zero-Interest Education Loans

2. National Minorities Development & Finance Corporation (NMDFC)
National Backward Classes Finance & Development Corporation (NBCFDC)
State Government Education Loan Schemes (Tamil Nadu, Kerala, etc.)
NGOs and Charitable Trusts (e.g., Faiz-E-Aam Trust, Vidyadhan Scholarship)
Institutional Programs (Some universities and foundations offer their own zero-interest loan
schemes)
Repayment Terms
Repayment generally starts after course completion or after securing employment. Students can
repay in easy monthly installments without any interest or penalty.
Benefits
No financial pressure during study period
0% interest throughout the repayment tenure
Encourages higher education accessibility
Builds credit history responsibly
Contact & Application
Students can apply through:
The respective bank or institution’s education loan portal
Government scholarship or minority welfare departments
Authorized NGOs or foundations
For details, visit the official websites of state or central education departments.