Student Loan Eligibility Calculator
Estimate your education loan eligibility, margin money, and collateral requirement using the IBA Model Scheme framework. Free, no login, nothing stored.
Based on the IBA Model Education Loan Scheme framework and a standard 50% FOIR assumption. Actual bank sanction depends on individual policy and credit assessment.
Year-by-Year Repayment Schedule
Based on your Estimated Eligible Loan, after the moratorium period ends.
| Year | Principal Paid | Interest Paid | Remaining Balance |
|---|
What Is This Calculator?
This tool estimates how much education loan you might realistically qualify for, based on two things banks actually look at: the IBA Model Education Loan Scheme's collateral and margin rules, and your co-applicant's (usually a parent's) capacity to service the resulting EMI. It's meant to help you plan and compare options before applying, not to guarantee a specific sanction amount.
Free, No Login, No Data Stored
This calculator runs entirely in your browser. There is no sign-up, no account, and nothing you enter is saved, tracked, or sent anywhere. It's free to use as many times as you need.
How to Use This Calculator
- Choose whether the course is in India or Abroad, since margin requirements differ.
- Enter your Total Course Cost and any Scholarship or personal funds you already have.
- Enter your co-applicant's Net Monthly Income and any Existing Monthly EMI obligations they already have.
- Choose an expected interest rate and repayment tenure.
- The result panel shows the loan amount needed, margin money required, collateral tier, and your estimated eligible loan based on repayment capacity.
Collateral and Margin Tiers (IBA Model Scheme)
| Loan Amount | Collateral | Margin Money |
|---|---|---|
| Up to INR 4 Lakh | None required, no guarantor needed | Nil |
| INR 4 Lakh to INR 7.5 Lakh | No tangible collateral - third-party guarantee typically acceptable | 5% (India) / 15% (Abroad), often Nil if covered under CGFSEL |
| Above INR 7.5 Lakh | Tangible collateral required (property, FD, etc.) | 5% (India) / 15% (Abroad) |
This is the standard framework followed by IBA member banks (most public sector and major private banks), though individual banks can apply their own risk-based modifications. NBFCs and specialised education loan lenders may follow different rules entirely.
How Eligibility Is Calculated
Loan Needed = (Course Cost - Scholarship) x (1 - Margin %)
Max Affordable EMI = (Net Monthly Income x 50%) - Existing EMIsThis assumes a standard Fixed Obligation to Income Ratio (FOIR) of 50%, a commonly used lending benchmark - though individual banks may use anywhere from 40% to 60% depending on their policy.
Max Loan = EMI x [(1+r)^n - 1] / [r x (1+r)^n]where r is the monthly interest rate and n is the number of monthly instalments.
The final "Estimated Eligible Loan" is the smaller of the loan amount needed and the maximum loan your repayment capacity supports - this shows whether income is likely to be the limiting factor.
Moratorium and Repayment
Under the IBA Model Scheme, the moratorium period is typically the course duration plus one year, or six months after securing employment, whichever comes first. No principal repayment is required during this period, though simple interest usually accrues on the outstanding amount and may be added to the principal once repayment begins.
Tax Benefit on Education Loans
Under Section 80E of the Income Tax Act, the entire interest paid on an education loan from a recognised financial institution is deductible from taxable income, with no upper monetary limit, for a maximum of 8 consecutive years starting from the year repayment begins. This deduction applies only to interest, not principal, and only under the old tax regime.
Who Is This Calculator For?
- Students and parents planning ahead before approaching a bank for an education loan.
- Anyone comparing studying in India versus abroad and how that changes margin requirements.
- Families checking whether their income can comfortably support the EMI once repayment begins.
This tool provides an estimate based on common lending frameworks and is not a loan offer or guarantee of approval. Actual eligibility depends on the specific bank or NBFC's credit policy, your academic profile, the institution's ranking, and a full credit assessment.
Frequently Asked Questions
Does this calculator guarantee loan approval?
No. This is an estimate based on the IBA Model Scheme framework and a standard repayment capacity assumption. Actual approval depends on the specific lender's policy, your credit history, the institution and course, and a full underwriting assessment.
Why does the co-applicant's income matter if the loan is for the student?
Since most students have no income of their own while studying, banks assess the co-applicant's (usually a parent's or guardian's) income and existing obligations to judge whether the household can service the EMI once repayment begins after the moratorium.
What is FOIR and why 50%?
FOIR (Fixed Obligation to Income Ratio) is the share of monthly income a bank assumes can safely go toward all EMI obligations combined. 50% is a commonly used benchmark across lenders, though some banks use a range between 40% and 60% depending on their risk policy.
What happens if my estimated eligible loan is less than what I need?
This suggests the co-applicant's repayment capacity may be the limiting factor rather than the loan scheme's collateral rules. Options typically include a stronger co-applicant, additional collateral to negotiate better terms, a partial scholarship, or extending the repayment tenure to lower the monthly EMI.
Can I use this for a private NBFC loan instead of a bank?
This calculator is based on the IBA Model Scheme, which most public sector and major private banks follow. Specialised NBFC education loan lenders often have different collateral thresholds, interest rates, and eligibility criteria, so treat this as a general reference rather than an exact match for NBFC policies.
Does interest accrue during the moratorium period?
Yes, typically simple interest accrues on the disbursed amount during the study period and moratorium, even though no repayment is due. Many banks offer a small interest rate concession to students who choose to pay this accrued interest during the moratorium instead of letting it capitalise.
Is this calculator free to use?
Yes, completely free, with no login and no data stored, and works on both mobile and desktop.
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