Calculate your education loan EMI after the moratorium period, total interest payable & year-wise repayment schedule instantly.
📌 Current Education Loan Rates (2026):SBI Scholar Loan: 8.15%HDFC Credila: 9.5%–13%Bank of Baroda: 8.85%Axis Bank: 13.7%–15.2%
🕐 Include Moratorium Period? (No EMI during study + 6–12 months grace period)
⚙️Loan Details
📅 Moratorium Period Details
Yr
Mo
⚠️ During moratorium, interest accrues on the loan. This interest gets added to your principal — increasing your total repayment amount. This is called Capitalisation of Interest.
Loan Amount₹10,00,000
₹50,000₹50 Lakh
Interest Rate (p.a.)8.5%
7%16%
Repayment Tenure10 Years
1 Year15 Years
Or type your values below
₹
%
Yr
📊Your Results
Monthly EMI (After Moratorium)
₹0
repayment starts after moratorium period
Interest accrued during moratorium: ₹0
Capitalised principal (actual loan you repay): ₹0
Principal
₹0
Total Interest
₹0
Total Payable
₹0
Payment Split
Principal Amount
—
Total Interest
—
Year
Opening Balance
Principal Paid
Interest Paid
Closing Balance
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InfoBuddy Tip: If possible, pay the interest during your moratorium period instead of letting it accumulate. On a ₹10 lakh loan at 8.5% for 4 years of study, the capitalised interest alone can be ₹3.4 lakhs — which gets added to your principal and increases your EMI significantly. Even paying partial interest during study saves a lot.
Smart EMI Calculator →
What is a Moratorium Period — And Why It Matters
The moratorium period is the time during which you are not required to pay any EMI — typically covering your entire course duration plus a 6–12 month grace period after completion. It is one of the most important features of an education loan and also the most misunderstood.
Education Loan Timeline
📚 Study Period
1–6 years No EMI required Interest accrues daily
⏳ Grace Period
6–12 months No EMI yet Interest still accruing
💰 Repayment
Up to 15 years EMI begins On capitalised principal
⚠️
Critical — Interest Capitalisation: During the moratorium, interest does not disappear. It accrues on your outstanding principal every month and gets added to the principal when repayment starts. On a ₹10 lakh loan at 8.5% with a 4-year course + 6 months grace, the capitalised principal at repayment start is approximately ₹13.4 lakhs — not ₹10 lakhs. Your EMI is calculated on this higher amount.
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Best strategy: If you or your parents can afford it, pay the simple interest every month during the moratorium period. This prevents capitalisation entirely — your principal stays at ₹10 lakhs and your EMI after graduation is significantly lower. SBI even offers a 1% interest concession for the full loan tenure if you service interest during the moratorium.
Education Loan Interest Rates — India 2026
SBI (Domestic)
8.15%
Starting p.a.
Bank of Baroda
8.85%
Starting p.a.
Canara Bank
8.90%
Starting p.a.
SBI (Abroad)
10.25%
Starting p.a.
HDFC Credila
9.75%
Secured loans
Axis / ICICI
9.50%+
Starting p.a.
Lender
Rate (p.a.)
Max Loan
Max Tenure
Collateral
Processing Fee
SBI Student Loan (India)
8.15% – 11.15%
₹10 Lakhs (unsecured)
15 years
Below ₹7.5L: None
Zero
SBI Global Ed-Vantage (Abroad)
10.25% – 11.15%
₹1.5 Crore
15 years
Required above ₹7.5L
₹10,000
Bank of Baroda (Baroda Scholar)
8.85% – 10.85%
₹80 Lakhs abroad
15 years
Above ₹7.5L
1%
HDFC Credila (Secured)
9.75% – 12%
No upper limit
15 years
Required for secured
1–1.25%
HDFC Credila (Unsecured)
11.25% – 13.50%
₹75 Lakhs
12 years
None
1–1.25%
Axis / ICICI Bank
9.50% – 13.50%
₹75 Lakhs – ₹1 Cr
15 years
None for select profiles
Up to 2%
Source: Bank websites and GradsLoan, May 2026. Girl students typically get 0.5% concession at public sector banks. Subject to change.
Section 80E — The Tax Benefit Most People Miss
Interest paid on education loans qualifies for deduction under Section 80E of the Income Tax Act — with no upper limit — for 8 consecutive years after repayment begins. This is one of the few deductions with no ceiling in Indian tax law.
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Example: If you pay ₹1,20,000 in education loan interest in FY 2026-27, you can deduct the entire ₹1,20,000 from your taxable income under Section 80E (old tax regime). At a 30% tax slab, that is ₹36,000 in tax saved — just from the interest deduction alone. Available for 8 years of repayment, this can save ₹2–3 lakhs in total tax over the loan’s lifetime.
📖 Real Example — ₹3.4L Extra Because of Capitalisation
Arjun took a ₹10 lakh education loan at 8.5% for his 4-year engineering degree. He was told “no EMI during course” — and assumed that meant no interest was being charged. It was not. By the time his repayment started (4 years study + 6 months grace = 4.5 years), his outstanding principal had grown to ₹14.6 lakhs due to interest capitalisation.
His EMIs were calculated on ₹14.6 lakhs — not ₹10 lakhs. His total repayment over 10 years was ₹21.3 lakhs. Had his parents paid simple interest (₹7,083/month) during the course, his principal would have stayed at ₹10 lakhs and he would have paid only ₹14.9 lakhs total — saving ₹6.4 lakhs over the loan lifetime.
Frequently Asked Questions
What is the maximum education loan I can get without collateral?
Public sector banks (SBI, Bank of Baroda, Canara Bank) offer up to ₹7.5 lakhs without any collateral. Above ₹7.5 lakhs, immovable property (house), fixed deposits, or LIC policies must be pledged. Some private banks and NBFCs like HDFC Credila offer unsecured loans up to ₹75 lakhs based on the student’s future employability and university ranking — but at higher interest rates of 11–13.5%.
What is the moratorium period and can I pay during it?
The moratorium period covers your course duration plus a grace period of 6–12 months after completion. You are not required to pay any EMI during this time — but interest continues to accrue and gets capitalised (added to principal) when repayment starts. You can voluntarily pay the simple interest during the moratorium — this is highly recommended as it prevents the principal from ballooning and SBI rewards this with a 1% rate concession for the full tenure.
Can I claim tax benefits on an education loan?
Yes. Under Section 80E of the Income Tax Act, the interest paid on education loans can be deducted from your taxable income with no upper limit — for 8 consecutive assessment years after repayment begins. This is only available under the old tax regime. The deduction is available to the borrower (student) or the parent who co-signed the loan, whichever is actually paying the EMI.
Is SBI or HDFC Credila better for a study abroad loan?
Depends on your priority. SBI offers lower rates (10.25% vs 11.25%+ unsecured), zero processing fees, and Section 80E benefits — but is slower (15–30 working days) and documentation-heavy. HDFC Credila processes faster (critical for visa deadlines), offers larger unsecured amounts, and is more flexible on collateral — but at 1.5–3% higher interest rates. For cost-conscious borrowers with time, SBI wins. For speed and flexibility, Credila or Axis Bank is better.
What happens if I cannot get a job after my course?
Most banks offer a 1-year grace period after course completion before repayment begins — giving you time to find employment. If you are unable to repay, most banks will restructure the loan rather than immediately take action, especially for first-time defaults. However, non-repayment will severely damage your CIBIL score and affect your ability to take any future loans. Contact your bank early if you foresee repayment difficulties — they have provisions for restructuring.
Should I pay the interest during the moratorium period?
If your family can afford it, yes — absolutely. Paying simple interest during the moratorium prevents the principal from capitalising, keeps your post-graduation EMI lower, and at SBI earns you a 1% rate concession for the entire repayment tenure. On a ₹10 lakh loan at 8.5% with a 4-year course, paying monthly interest (≈₹7,083/month) during study saves approximately ₹6–8 lakhs in total interest over the 10-year repayment period.
An education loan is one of the most financially significant decisions a family makes. The moratorium period sounds like a relief — but if interest is allowed to capitalise unchecked, it can add 30–50% to the principal before you even start repaying.
Use the calculator above with moratorium turned on to see your real cost. Compare SBI and Credila. Pay interest during the course if possible. Claim Section 80E every year after you start working.
The education is an investment. Make sure the loan that funds it is structured as efficiently as possible.
AK
Anshuman Kumar
FP&A Manager | MBA Finance, Bharti Vidyapeeth | 10+ Years Financial Planning & Taxation
All calculator content on InfoBuddy is reviewed by Anshuman Kumar — a finance professional with 10+ years of experience in loan analysis, taxation, and financial planning. He ensures every rate, formula, and tax guidance on this page is accurate and applicable to Indian borrowers in 2026.
Disclaimer: EMI and capitalisation calculations use standard financial formulas for educational reference only. Interest rates shown are indicative as of May 2026 from bank websites and aggregators, and are subject to change. Tax benefit information is based on the Income Tax Act provisions under the old tax regime as of May 2026. Always verify loan terms, rates, and tax implications with your lender and a qualified tax advisor. InfoBuddy is not a bank, NBFC, or SEBI-registered financial advisor.
