Dr. Ambedkar interest subsidy on Educational Loan
The is a Central Sector Scheme of the Ministry of Social Justice & Empowerment to provide interest subsidy to the student belonging to the OBCs and EBCs on the interest payable for the period of moratorium for the Education Loans for overseas studies to pursue approved courses of studies abroad at Masters, M.Phil. and Ph.D. level.
Conditions for Interest Subsidy
- The Scheme is applicable for higher studies abroad. The interest Subsidy shall be linked with the existing Educational Loan Scheme of Indian Banks Association (IBA) and restricted to students enrolled for course at Masters, M.Phil and Ph.D level.
- The interest subsidy under the scheme shall be available to the eligible students only once, either for Masters or Ph.D levels. Interest subsidy shall not be available to those students who either discontinued the course mid-stream due to any reason, or those who are expelled from the institutions on disciplinary or academic grounds.
- If a student violates any condition of the scheme, the subsidy will be discontinued forthwith.
- If a student is found to have obtained the subsidy by false statement/certificates, the subsidy will be withdrawn/ cancelled forthwith and amount of the subsidy paid shall be recovered with penal interest, apart from taking criminal action as per law.
- The students obtaining benefits under this Scheme shall not be given the interest subsidy if he gives up Indian citizenship during the tenure of the loan.
- The nodal bank will maintain a separate account and records relating to the funds received from the Ministry of Social Justice and Empowerment and these will be subject to inspection/audit by the officers of the Ministry, or any other agency designated by the Ministry and C&AG.
- The Nodal Bank shall place all relevant details of financial and physical achievements on its website and implement the scheme as per the Memorandum of understanding to be signed between the designated Banks and the Ministry of Social Justice and Empowerment.
- The Nodal Bank will lay down the detailed procedure for processing and sanctioning of interest subsidy to eligible students in consultation with the Ministry.
- The Scheme will be evaluated at regular intervals by the Ministry or any other agency designated by the Ministry and the cost of the evaluation study will be borne by the Ministry.
- The term and conditions of the Scheme can be changed at any time at the discretion of Ministry of Social Justice and Empowerment to improve procedure and achieve more effective implementation. However, there should not be financial implications.
- The students should have secured admission in the approved courses at Masters, M.Phil or Ph.D levels abroad for the courses indicated in the guidelines.
- He/She should have availed loan from a scheduled bank under the Education Loan Scheme of the Indian Banks Association (IBA) for the purpose.
- For the candidate applying under the OBC category, OBC Caste certificate in the prescribed Performa issued by the competent authority must be taken by the Banks.
- Income Ceiling
- For OBC candidates, total income from all sources of the employed candidate or his/her parents/guardians in case of unemployed candidate shall not exceed Rs.8.00 lakh per annum.
- For EBC candidates, total income from all sources of the employed candidate or his/her parents/guardians in case of unemployed candidate shall not exceed Rs.2.50 lakh per annum.
- Under this Scheme, Income certificate produced by the student for availing Educational Loan viz. ITR/Form 16/Audited Accounts/Income certificate issued by the authority of State Government/UT Administration is acceptable to determining Income ceiling.
Rate of Interest Subsidy
- Under the scheme, interest payable by the students availing the education loans of the IBA for the period of moratorium (i.e. course period, plus one year or six months after getting job, whichever is earlier) as prescribed under the Education Loan Scheme of the IBA, shall be borne by the Government of India.
- After the period of moratorium is over, the interest on the outstanding loan amount shall be paid by the student, in accordance with the existing Educational Loan Scheme as may be amended from time to time.
- The candidate will bear the Principal installments and interest beyond moratorium period.
The Scheme will be implemented by the Nodal Bank as per MoU between the Banks and the Ministry of Social Justice & Empowerment.
To access the detailed guidelines, click here.
Source : Ministry of Social Justice & Empowerment
Last Modified : 12/8/2021
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