West Bengal Student Credit Card Loan Scheme

The West Bengal Student Credit Card Loan Scheme offers a significant opportunity for students to pursue their educational aspirations.
Under this scheme, students can avail a maximum loan amount of ₹10,00,000 with a simple interest rate of 4% per annum after interest subvention.
The interest rate is calculated as the prevailing 3-year Marginal Cost of Funds Based Lending Rate (MCLR) of State Bank of India plus 1%. This rate, determined at the time of sanction, remains fixed on a simple interest basis for the entire loan term.

Margin Requirements:
• For loans up to ₹4,00,000, no margin is required.
• For loans exceeding ₹4,00,000, a 5% margin is applicable.
• Any scholarships or assistance received must be included in the margin calculation, which is done annually on a pro-rata basis as disbursements are made.

Eligible Expenses for the Loan:
The Credit Card may be used to avail a loan for various expenses, including:
• Course fees payable to Schools, Madrasahs, Colleges, Universities, or Professional Institutes such as IITs, IIMs, IIESTs, ISIs, NLUs, AIIMSs, NITs, XLRI, IISCs, BITS, SPA, NID, IIFTs, ICFAI Business School, and various competitive coaching institutes for examinations like Engineering, Medical, Law, IAS, IPS, WBCS, SSC, etc.
• Accommodation fees in a school, madrasah, college, or university hostel, or rent/license fees for off-campus living, including paying guest accommodations.
• Caution deposits, building funds, refundable deposits, examination, library, or laboratory fees, supported by institutional bills or receipts.
• Costs of purchasing books, computers, laptops, tablets, or equipment.
• Other expenses required to complete the course, such as study tours, project work, or thesis.
• Up to 30% of the total sanctioned loan can be used for non-institutional expenses throughout the course.
• Up to 20% of the total sanctioned loan can be used for living expenses during the course.

All expenses under these categories must be reported to the bank and the Department via the online portal, accompanied by appropriate receipts, bills, or documents.

Important Notes:
• A student can avail a loan under this scheme at any time during their course of study.
• The concerned bank must upload loan details to the department’s portal immediately after disbursing the loan and update them periodically.
• The loan application must be submitted jointly by the student and a parent or legal guardian as co-borrower.
• The student and parent/legal guardian will enter into an agreement with the bank.
• Banks should not impose any unnecessary restrictions or conditions, including collateral security, when sanctioning the loan.
• Banks must not require any security or collateral, tangible or intangible, beyond the co-obligation of the parents or legal guardians. The State Government will enter into a separate agreement with the banks regarding this matter.
• A life cover equivalent to the sanctioned loan amount will be provided for the student. The insurance premium, to be borne by the student, will be debited from their loan account.

Repayment Holiday/Moratorium:
A one-year moratorium or repayment holiday is applicable under this scheme. It commences either upon course completion or one year after employment, whichever is earlier.

Repayment Terms:
• The repayment period for all loans under this credit card, including the moratorium/repayment holiday, is 15 years.
• The student or parent/legal guardian may prepay the loan at any time without incurring penalties or processing fees.
• A 1% interest concession is offered to borrowers who fully service interest during the study period.
• The student or co-borrower is primarily liable for timely loan repayment.
• The loan carries a simple interest rate of 4% per annum. The State Government provides interest subvention to all borrowers, effectively reducing the interest rate to 4% per annum for borrowers.

Timeline:
A time-bound action plan for loan sanctioning and disbursement will be announced by the Higher Education Department and the School Education Department after obtaining necessary approvals.