IDBI Padho Pardesh Scheme on Education Loan

About the IDBI Padho Pardesh Scheme

The IDBI Padho Pradesh scheme on IDBI Bank education loan targets students from minority communities (as defined under Section 2(c) of the National Commission for Minorities Act, 1992). It is available to students whose parents’ annual income does not exceed ₹6 lakh. The scheme covers full interest on education loan for overseas Master’s, MPhil, and PhD programs. This helps reduce the initial financial strain on families and supports a stronger child education plan.

IDBI Padho Pardesh Scheme Interest Rates

The interest rates for education loans depend on multiple factors, including loan amount, institution, and the borrower’s risk profile. However, under the IDBI Padho Pradesh scheme, interest rates vary as follows:

• Up to ₹7.5 lakhs: 10.45%

• Above ₹7.5 lakhs: 10.20%

Note: The interest rates are based on IDBI Bank’s prevailing terms as of 18 June 2025. These are subject to revision depending on RBI Repo Rate changes and internal bank policy updates.

Features of the IDBI Padho Pardesh Scheme

The IDBI Padho Pardesh Scheme has several features that ease the financial journey of students:

• Full Interest Subsidy for Overseas Education: The government covers 100% of the interest during the moratorium.

• Supports Higher Education Abroad: Available for Master's, MPhil, and PhD programs at recognised foreign universities.

• Reduces Early Repayment Pressure: Gives families time to plan repayments and build a structured child education allowance.

• Works Well with Education Planning: Can be paired with a child investment plan or tax-saving strategies under Income Tax Section 80E.

• 35% Seats Reserved for Girl Students: A minimum of 35% of the total seats are earmarked for girl students. If unfilled, they may be transferred to boys.

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Eligibility for IDBI Padho Pardesh Scheme

To qualify for this scheme under IDBI Bank, the applicant must meet the following conditions:

• Citizenship & Minority Status: Indian national belonging to a notified minority community (Muslim, Christian, Sikh, Buddhist, Jain, or Parsi).

• Parental Income: Annual family income must be less than ₹6 lakh. Proof via an income certificate from a competent authority is mandatory.

• Loan Source: The education loan must be taken under the IBA Model Education Loan Scheme from IDBI Bank.

• Moratorium Window: Interest subsidy is available only during the moratorium (course period + 1 year or 6 months after job, whichever is earlier).

Documents Required for IDBI Padho Pardesh Scheme

To apply for the Padho Pardesh Scheme through IDBI Bank, the following documents are typically required:

• Minority community certificate

• Proof of admission to a foreign institution

• Income certificate (certified by a competent state authority)

• Loan sanction letter from IDBI Bank

• KYC documents for the student and co-borrower

• Education qualification documents

• Details of course fees and structure

Most Important Terms and Conditions

Before applying, it's essential to understand the key rules that govern the IDBI Padho Pardesh Scheme:

• One-Time Benefit Only: This subsidy is granted only once per student for higher education abroad. Plan your academic journey carefully to make the most of it.

• Repayment Starts After Moratorium: The repayment of the principal starts after the moratorium period ends. Total loan tenure can extend up to 15 years, including this period.

• Course Completion Mandatory: If the course is discontinued or the student is expelled (except for genuine medical reasons), the subsidy is revoked, and interest must be paid.

• Citizenship Continuity Clause: Students will lose the interest subsidy benefit if they give up Indian citizenship during the loan tenure.