PSB Padho Pradesh Scheme for Studying Abroad

About the PSB Padho Pradesh Scheme for Studying Abroad

The PSB Padho Pradesh Scheme of Interest Subsidy on Educational Loans for Overseas Studies is a Central Government initiative being offered by Punjab & Sindh Bank. The education loan scheme is only restricted to the students who are members of minority communities as stated in Section 2(c) of the National Commission for Minorities Act, 1992.

PSB Padho Pradesh Scheme for Studying Abroad - Rate of Interest

Under this scheme, the Government of India pays the entire interest on the education loan during the moratorium period. The benefit applies only to those loans taken from scheduled banks under the IBA-approved education loan scheme.

The interest rates typically follow the EBLR structure:

• Loans above ₹7.5 lakh for overseas education may have rates like EBLR (7.55%) + 1.85% = 9.40%

If you want to structure your overseas studies better, consider exploring tools such as a child education allowance to plan for your child’s future academic needs.

Note: The rates are updated per Punjab & Sindh Bank's latest terms as of 20 June 2025. These may change based on RBI Repo Rate movements or bank lending policy updates.

Features of the PSB Padho Pradesh Scheme for Studying Abroad

Here are the features of the PSB Padho Pradesh Scheme for studying abroad:

• Moratorium Interest Coverage: The government bears the full interest during the course duration and a one-year grace period.

• Applicable Once Only: Subsidy is granted only once at the Master’s or Ph.D. level.

• Linked to IBA Loan Scheme: Must be availed alongside a Punjab & Sind Bank education loan from a scheduled bank under IBA guidelines.

• Gender Quota: Under the scheme, 35% of the total slots are reserved for female students.

• Selection Committee Process: Awarding of subsidy is finalised by a committee formed by the Ministry of Minority Affairs.

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Eligibility Criteria for PSB Padho Pradesh Scheme for Studying Abroad

The eligibility criteria of the PSB Padho Pradesh Scheme for studying abroad are as follows:

• Community Status: Applicant must belong to a notified minority community as per law.

• Admission Proof: Must have secured admission abroad in an approved Master's, M.Phil, or Ph.D. programme.

• Loan Requirement: An approved education loan from a scheduled bank under the IBA scheme must be approved.

• Fresh Application Timing: Must apply for the subsidy in the first year of the course; later applications are not accepted.

Planning early through a child investment plan can make funding education abroad easier and reduce reliance on loan subsidies.

Documents Required for the PSB Padho Pradesh Scheme for Studying Abroad

To apply for the PSB Padho Pradesh Scheme for studying abroad, you need to have the following documents:

• Proof of minority community status

• Admission letter from a foreign institution

• Copy of education loan sanction letter

• An income certificate issued by a competent state authority

• Valid Indian passport

• Declaration form and affidavit (if applicable)

Using a child education plan early can reduce the dependency on loans for higher studies.

Most Important Terms and Conditions

Here are some of the most important terms and conditions for the PSB Padho Pradesh Scheme: 

• Course Discontinuation Clause: A student who drops out or is expelled will not benefit from the subsidy.

• Citizenship Requirement: If the student renounces their Indian citizenship while on the loan, the subsidy will be withdrawn.

• False Document Penalty: Any falsification causes an immediate termination of subsidies and leads to prosecution.

• Post-Moratorium Liability: Student is liable for all the interests and instalments following the termination of the moratorium.

You can always use an income tax calculator to check your eligibility and tax benefits.