India's largest lender, State Bank of India (SBI), is planning to slash lending rates for education loans by 0.25 per cent as early as this week. SBI plans to announce the rate cut early this week, enabling students who take loans from May 1 to September 30, avail the benefit of reduced rates, an SBI official said.

"The idea is to help students aspiring for higher studies with adequate financial support. Interest rates on all category of education loans are likely to come down by 0.25 per cent. The scheme will be applicable for all education loans approved during May-September, 2009," the official said.

While education loans up to Rs four lakh do not require any collateral security, those between Rs 4 lakh and Rs 7.5 lakh would require a third party guarantee.

For loans above Rs 7.5 lakh and up to Rs 20 lakh, borrowers will have to produce some tangible assets such as a house or land as security. The loan re-payment period ranges from five to seven years.

SBI has an education loan portfolio of Rs 6,600 crore and has seen its portfolio growing by around 50 per cent in the past one year, the official said.

"We had targeted a growth (in education loans) of 35 per cent in FY '09 but has far exceeded that target on account of a good demand," the official said.
 The bank gives loans up to Rs 10 lakh for studies in India and up to Rs 20 lakh for courses abroad.
    
"The economic downturn did not have any impact on this segment. Infact we have received more loan enquiries in the past few months. The demand for education loans is likely to go up in the months ahead," the official said.
   
SBI has recently slashed rates in various categories such as SME, vehicle and home loans with a view to improve the credit flow to the market.

New Ipad Application :Business Standard's all new IPad App Click here to download for free Other Stories      - Wall Street opens higher on Greek deal - Oil cos seek compensation for losses on petrol - Centre for 6% road tax on cars, two-wheelers - RBI raises bank rate to 9.5% - Axis Bank reappoints Shikha Sharma as Managing Director

Tags : sbi | banking | educational loans   Read Business news in  Advertisements -  Now property search gets more exciting than ever before! -  IndianOil Citibank Card at Zero annual card fee -  High Growth Business Opportunities in Africa - Register to explore -  Save over Rs.3000 with IndianOil Citibank Card -  Office 365 for professionals and small businesses. -  We live for our family. have you secured them? -  Are You Serious About Your Future? Click here to know more -  Financial Learning now made easier and more convenient. -  India's No. 1 Property Site. Click here to know more.. -  Win a Business Class Ticket to Europe..Know more.. -  Exim Bank Conclave on India - Africa Project Partnership. Know more.. -  Be part of it The World's Largest Aircraft. -  Creating Wealth made simple the SIP way. Know more.. -  Only Developer to give a guarantee on time space & rate. -  Buy Your Property with Our Triple Guarantee in India. -  Improve Patient Care & Experience. Click here to know more -   Introduce a New Automotive Luxury Car.. know more -  Health is Wealth..... Insurance + Savings... Know More...