Education Loan & Margin Money


Updated on Apr 30, 2021


With the cost of education on a steep rise, careful financial planning is crucial for aspirants of higher education from India and abroad. In addition to tuition fee, living, travelling and other related expenses form a substantial part of the complete cost of education. These expenses must be planned for in advance. In India, various financial institutions provide education loans to students to help them bridge financial gaps while funding their education.

In recent times, education loans have come to be seen as a preferred way of funding education over self-finance since they offer –

  • Attractive tax benefits under Section 80E of the Income Tax Act of India,
  • Up to 100% finance of complete cost of education,
  • Doorstep service, and
  • Easy repayment terms, etc.

However, the financial terms surrounding education loans may confuse some students and their parents. One such term is Margin Money.

Everything You Need To Know About Margin Money

When it comes to education loans, margin money is a certain percentage of the complete cost of education the borrower is required to pay from his/her own funds. The remaining amount is then paid by the bank in the form of education loan. This borrower contribution has to be paid on a pro-rata basis as and when the disbursements are taken from your education loan provider.

This borrower contribution can be in the range of 10%-25% for studies in India and abroad. While most banks have made margin money a mandate on education loans, financial institutions like HDFC Credila offer education loans without any margin money.

For some students and their parents, margin money can be a major cause of concern. Some students are even forced to avail personal loans on high interest rates to pay for the margin money which only increases their financial burden.

With HDFC Credila, you can avail customized education loans with zero margin money. Other unique benefits offered by HDFC Credila are -

  • Tax Benefits under Section 80E
  • Loan Approval before Admission Confirmation
  • 100% Finance
  • Acceptance of Multi-city Co-borrower
  • Doorstep Service
  • Easy & Flexible Repayment Terms

For more information on HDFC Credila’s Education Loan, visit

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