School, via the bank

The professional market is becoming more and more competitive. Our 600 management programmes nationwide, which graduate approximately 5,000 students a year, are rendering MBA degree holders a dime a dozen. Apart from one detail "" the programmes themselves cost substantially more than a dime.

As do other educational programmes, whether they are a professional or technical graduate degree, a liberal arts undergraduate degree, or a PhD in botany. A management degree at an IIM will cost just under Rs 2,00,000, but if you're going abroad you can end up spending anywhere between £10,000 a year to $50,000 a year for an MBA or a similar masters.

If you're not blessed with parents who can afford to send you to graduate school, or if you're not thrilled about sponging off them, there is still hope. Apart from scholarship programmes offered by bodies such as the British Council and internal financial aid packages individual colleges may offer, banks are also doing their bit to make it easier for you to get a higher education.

In 2001, the Indian government, in conjunction with the Reserve Bank and the Indian Bankers' Association, implemented the Comprehensive Educational Loan Scheme. This scheme, based on the premise that everyone should have access to basic education, was designed to help the poor gain access to a primary education, and anyone who aspires to it but cannot afford it, a higher education. It extends to undergraduate as well as graduate degrees, in India as well as abroad.

The details of schemes vary from bank to bank, but the umbrella loan scheme means that many features will be common. The amount of the loan, for instance, will usually be up to a maximum of Rs 7.5 lakh for studies within India and Rs 15 lakh for studies abroad. (Many banks, however, do offer more "" at the State Bank, for instance, you can borrow up to Rs 20 lakh if you're going abroad and HSBC will give you Rs 25 lakh).

The requirements for the loan again, will only deviate minimally from state guidelines. According to the government scheme, to be eligible, a student needs to be an Indian national, already be in possession of an acceptance letter from his or her school, and in the case of Indian universities, have scored a minimum of 60 per cent in the entrance exam.

Most banks will adhere to this general guideline, but may ask for additional items such as an approved list of expenses from the school, income tax statements from the student and possibly the parents, and an account of assets and liabilities that they own or owe.

The interest rate will normally be level with the prime lending rate (PLR) of the banks, if the loan is up to Rs 2 lakh, but be PLR plus 1 per cent over Rs 2 lakh. Security will only be needed if the loan amount is over Rs 2 lakh. (Most banks have moved this dividing point from Rs 2 lakh up to Rs 4 lakh).

There may be additional caveats: some banks have an age limit, for instance the Oriental Bank of Commerce insists that you be under 45 years of age, and many (though not all, for instance at the Indian Overseas Bank, if you're over the age of 18, there is no need to have a co-signer) will also insist that the parents or guardians be co-signers.

In terms of payback, most banks will give you the Equated Monthly Instalments (EMI) option, slicing what could be a mammoth payback into easier-to-swallow monthly packages. Most banks will also give you time to start hunting around for a job before they expect you to start paying it back. The State Bank, for instance, expects you to start payments either from six months after getting a job, or one year after the completion of your course "" whichever comes first.

All in all, the loan schemes banks are offering nowadays are a boon for students. Look out mostly for smaller banks though, for most large private players, such as ICICI, HDFC or Citibank (which has a very comprehensive student loan system in its branches abroad), do not have extensive educational schemes.