Why an 80E Education Loan is the Best Option for Funding Your Higher Studies?

Why an 80E Education Loan is the Best Option for Funding Your Higher Studies?

Going for postgraduate studies is a significant achievement that can pave the way for a better career or further studies. However, it comes with the expensive cost of tuition fees, which can be a considerable obstacle to some. Fortunately, the government of India provides financial assistance in the form of education loans. Among the various education loan options, an 80E education loan is the best option for funding your higher studies. In this article, we’ll look into why that is the case and why you should consider it.

What is an 80E Education Loan?

To understand the benefits of an 80E education loan, it’s crucial to know what it is. An 80E education loan is a specific type of loan offered by authorized financial institutions to students pursuing postgraduate studies. It’s named after the section of the Indian Income Tax Act, which states that the interest paid on such loans is eligible for tax benefits. The loan covers tuition fees and other related expenses such as accommodation, transportation, and books.

No Need for Collateral

Unlike other education loans, the 80E education loan doesn’t require collateral. For students who don’t have any assets to offer as collateral, this is a significant relief. Collateral is often a significant obstacle to receiving loan approval. With an 80E education loan, students are not expected to have any guarantor or security. The loan is granted to the student based on their credit history, academic qualifications, and future earning potential.

Low Interest Rates

An essential factor to consider when taking any loan is the interest rate. An 80E education loan comes with competitive interest rates that make it easier for students to repay their debt. The interest rate is typically lower than that of other loans. Moreover, the interest paid on an 80E education loan is eligible for tax deductions under Section 80E. This makes it more cost-effective in the long term.

Flexible Repayment Terms

The repayment terms of an 80E education loan are designed to accommodate the student’s financial situation. Repayment can begin after the completion of the course or the grace period of six months after the student has secured a job. The tenure of repayment is also flexible, ranging from 5 to 15 years. This makes it easier for students to repay their loan without financial strain after completing their studies.


An 80E education loan is an excellent option for students seeking higher studies. It’s affordable, has flexible repayment terms, no collateral requirements, and tax benefits. Now that you know why an 80E education loan is the best option for funding your higher studies, you can make an informed decision. By taking advantage of this loan, you can focus on your academic and career goals without financial stress.

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