The value and significance of education is well known to all. In fact, education can be termed as the true wealth of an individual. Everybody wants to provide their kids with the best possible education. But, at times the high fees charged by schools these days, makes it difficult for parents to bear the cost of education of their wards. Private school education in metros can cost between Rs. 50,000 to Rs. 5, 00,000 annually, with playschools alone costing about Rs. 35,000 to Rs. 1, 00,000 per year.
Now-a-days, when faced with financial crises, parents have the option of approaching banks to avail education loans meant specifically for paying school fees of children studying in nursery to senior secondary. At present, only a few banks, mostly nationalized ones, are offering such loans. But this segment of education loans is steadily gaining popularity among parents of school going kids.
The features of education loans for school children are a bit different as compared to education loans taken for funding college education or for vocational courses.
- Loans are provided to Indian nationals who are residing in India.
- The students should study in schools affiliated to recognized boards like ICSE, CBSE or state education board.
- Although banks will provide such loans to every customer approaching them, but usually priority is given to the existing customers of the bank.
Generally, the loan amount covers tuition fees, admission fees including annual fees and other deposits such as caution money, refundable deposits, building fund, maintenance fees etc. It also covers other expenses such as development fees, examination fees, Library deposit, Laboratory deposit, Hostel charges and other expenses related to purchase of books, equipment, uniforms, personal computers etc.
The loan amount varies between the minimum of Rs. 10, 000 to a maximum of Rs. 4, 00,000. Most banks provide loans for school children within this range.
Banks prefer to disburse the amount directly to the concerned school through demand drafts. In case of purchase of books and other stationary items, cash is disbursed on the production of receipts.