Personal Loan for Child’s Education

As a parent, you will always have the best interest in your mind for your children. You will want them to study in a reputed school and provide them with excellent opportunities for their higher education. However, school and college costs are mounting every year. A pre-school admission for a year itself comes up to Rs. 1 lakh. As your child steps into primary and secondary education, these expenses keep climbing thereafter. But in case of a deficit in funds, you can opt for personal loans and use that to fulfill any expense related to academics.

What is a Personal Loan for Child’s Education?

We, at SMFG India Credit, provide a loan amount for your child’s studies in a short time.. Such type of loan is different than a traditional education loan in the following ways:

• In personal loans for child’s education, it is the working parent who takes the loan, and not the child. Loans like these complement your child’s academic journey at any point in time.
• Upon approval,  the loan is transferred to your bank account. Thus, you can decide when and where you want to use the funds.
• Disbursement of funds is done only after final loan approval.

Please note that most lenders do not offer personal loan for students, since students usually do not fit the eligibility criteria of employment and income. However, if an applicant is salaried or self employed, and wishes to pursue a part time course, depending on the lender’s policy, they may be able to avail a personal loan to finance the course.

Features and Benefits of a Personal Loan for Child’s Education

The key features and benefits of SMFG India Credit personal loan for child’s education include:

• Parents can avail personal loans for their child’s education up to Rs. 30 lakhs*
• Self-employed individuals can borrow up to Rs. 10 lakhs*
• Tenure for personal loan for child’s education is between 12 months and 60 months
• Disbursement of funds is done only after final loan approval.

Interest Rates and Other Charges of Personal Loans for Child’s Education

Eligibility Criteria for Personal Loan for Child’s Education

Listed below are the eligibility criteria for an instant loan for education:

• You should be a Resident India to apply for personal loan for child’s education.
• Your age cannot exceed 65 years at the time of loan maturity

For Salaried Professionals:

• The minimum monthly income must be Rs. 25,000 if residing in Mumbai or Delhi, and Rs. 16,000* if residing in any other city in India.
• As an applicant, you should be working either with a private limited company or public sector undertaking (local, state, or central).

For Self Employed:

• You should have a minimum income per year – this amount varies for each case depending on factors such as location, loan amount required and the organisation’s policy at the time of loan application.
• Financial documents showing proof of stable income.

Documents Required For Personal Loan for Child’s Education

The list of documents required for an instant personal loan for child’s education are:

• A recent passport-sized photograph
• A government recognised identity proof and address proof
• PAN Card is mandatory 
• Bank statements of the last six months    
• Proof of income (pay slips/salary certificate), Form 16, Income tax returns for salaried individuals
• Business registration proof, company’s financials, income tax returns, etc. for self-employed applicants

How To Apply for A Personal Loan for Child’s Education?

These steps will guide your personal loan application journey at SMFG India Credit:

1. Provide Preliminary Details

Enter your personal details, including your mobile number, PAN, pincode, and employment type (salaried or self-employed).

2. OTP-Based Verification

Authenticate your mobile number with a 6-digit OTP.

3. Submit Additional Details

Submit more details such as your email address, date of birth, gender, and annual household income. Please note that verifying your email ID is also required.

4. Provide Employment Information

Detail your employment information if you are a salaried applicant.

5. Submit a Bank Statement

Kindly submit your bank statement via Net Banking, an Account Aggregator, or by uploading the file. Based on your banking information, we will generate a loan offer. This is applicable only to salaried individuals.

6. Identity Verification

Conduct the necessary digital verifications for your identity and share address details. Please use well-known processes like CKYC, Offline Aadhaar XML-based KYC, or DigiLocker. Take a selfie as a part of the process of verifying your identity.

7. Submit Bank Account Details

Provide your bank account details for verification.

8. Input Additional Details

After successful bank account verification, you will be asked to fill in the 'Additional Details' section with information about your marital status, loan purpose, father's name, and mother's maiden name.

9. Set Up E-NACH for Re-payment

Choose between a debit card and internet banking as your re-payment mode and set up E-NACH.

10. Review and Sign the Agreement

Digitally sign the loan contract after a careful review. Complete the process with an OTP confirmation.

Secure a personal loan by completing these steps and move closer to realising your financial ambitions.

Tips to Use a Personal Loan for Child’s Education Responsibly

When utilizing a personal loan for child’s education, responsible management is crucial. Here are some tips:

• Budget Wisely: Plan your expenses meticulously, considering tuition, accommodation, and other essential costs.
• Borrow Only What You Need: Avoid the temptation to borrow more than necessary. Calculate your requirements and borrow accordingly.
• Understand the Terms: Thoroughly comprehend the loan terms, including interest rates, repayment schedules, and any associated fees.
• Regular Repayments: Ensure timely repayments to maintain a good credit history and avoid penalties.
• Budget Management: Until you have repaid the personal loan, repayment of the loan should be your highest priority. Manage your monthly budgets wisely.