Punjab and Sind Bank (PSB) is a government-owned public sector bank with 79.62% government ownership, headquartered in New Delhi with 1,466 branches. For Indian students planning study abroad, PSB offers education loans under its IBA Model scheme and the specialized PSB Excellence scheme for students at premier institutions.
As a public sector bank, PSB’s key advantages are competitive interest rates (starting at 8.75% for IBA abroad loans), zero processing fees, eligibility for government interest subsidies (CSIS, Padho Pardesh), and an unusual 1% interest concession for borrowers who pay interest during the moratorium period. The main limitation: Rs 20 lakh maximum for study abroad – insufficient for most full-program costs.
Punjab and Sind Bank Education Loan 2026 – Quick Reference
Feature | Details |
Bank type | Public sector bank. Government of India owned (79.62%). Headquartered New Delhi. |
Education loan products | (1) PSB IBA Model Education Loan (abroad), (2) PSB Excellence Loan (premier institutes), (3) PSB IBA Skill Loan (vocational) |
Interest rate (IBA abroad loan) | MCLR+2.00% (up to Rs 7.5 lakh) / MCLR+1.50% (above Rs 7.5 lakh). Approx. 8.75-9.00% p.a. (2026) |
Interest rate (PSB Excellence) | 10.30% p.a. and above (premier institutes in India) |
Interest concessions | 0.5% for girl students. 1% concession if interest paid regularly during moratorium. |
Maximum loan (abroad – IBA scheme) | Up to Rs 20 lakh. Higher amounts possible on case-by-case basis for select courses. |
Collateral (up to Rs 4 lakh) | Not required. Parents as joint borrowers. |
Collateral (Rs 4-7.5 lakh) | Third-party guarantee. CGFSEL waiver available. |
Collateral (above Rs 7.5 lakh) | Tangible collateral required (property, FD). Assignment of future income also required. |
Processing fee | NIL. However Rs 2,000 deposit in savings account required – refunded after full disbursement. Forfeited only if loan not availed. |
Moratorium period | Course duration + 1 year (or 6 months after getting job – whichever is earlier) |
Repayment tenure | Up to 15 years after moratorium |
Prepayment charges | Nil |
Government subsidy eligible | Yes – CSIS, Padho Pardesh, Dr Ambedkar Scheme (all applicable for IBA scheme at PSB) |
Section 80E benefit | Yes – old tax regime |
Note: PSB’s interest rates are floating and linked to its 1-year MCLR. The rates above are indicative for 2026. Always verify current rates on punjabandsindbank.in before applying.
Punjab and Sind Bank Education Loan Products – Compared
Feature | PSB IBA Model Loan (Abroad) | PSB Excellence Loan | PSB IBA Skill Loan |
Purpose | Education loan for studies abroad under IBA framework | Specialized loan for IITs, IIMs, and AA/A-rated universities abroad | Vocational and skill development courses |
Max loan (abroad) | Rs 20 lakh | 100% of demonstrated financial need (no fixed cap for premier institutes) | Up to Rs 1.5 lakh (primarily India-based) |
Collateral | Standard IBA: none up to Rs 4L, third-party guarantee Rs 4-7.5L, tangible above Rs 7.5L | NO collateral required (premier institutes) | Not applicable for study abroad |
Interest rate | MCLR+2% or MCLR+1.5% depending on amount (~8.75-9%) | 10.30%+ | Standard rates |
Processing fee | NIL (Rs 2,000 refundable deposit) | NIL | NIL |
Co-applicants | Parents as joint borrowers | Both parents / one parent + one guardian / two guardians required | As applicable |
Eligible courses | Professional/technical courses abroad. Diploma courses allowed. NOT vocational. | Students at IITs, IIMs, and internationally AA/A-rated universities | Vocational and skill development courses |
Govt subsidy eligible | Yes – CSIS, Padho Pardesh etc. | Yes – CSIS if eligible | Yes if applicable |
Best for | Most study abroad students seeking a public bank loan | Students admitted to IITs, IIMs, or globally top-rated universities | Career skill development – not study abroad focus |
The PSB Excellence Loan is the most compelling product: no collateral, no processing fee, 100% need-based funding for students at premier institutions. Check directly with PSB whether your specific university qualifies as ‘premier’ under their AA/A rating classification.
Punjab and Sind Bank Education Loan Interest Rates 2026
PSB’s interest rates for the IBA Model scheme are MCLR-linked:
Loan Amount | Rate Formula | Approx. Rate 2026 | Concession Available |
Up to Rs 7.5 lakh | 1-year MCLR + 2.00% | ~8.75-9.00% p.a. | 0.5% for girls; 0.5% additional if collateral provided between Rs 4-7.5L |
Above Rs 7.5 lakh | 1-year MCLR + 1.50% | ~8.25-8.75% p.a. | 0.5% for girls |
PSB Excellence (premier institutes) | 10.30%+ p.a. | 10.30%+ | Premier institute concession may apply |
Moratorium interest concession | 1% reduction if interest paid during moratorium | Applied retrospectively on full repayment start | All PSB loan holders eligible |
The 1% moratorium concession is unusual and valuable: if you pay interest regularly during your moratorium period, PSB gives you a 1% reduction on the rate. At moratorium end, the interest is recalculated with this concession and any excess paid is refunded or adjusted in your favor. This is a genuine incentive to pay interest during moratorium.
PSB vs Other Public Banks – Quick Comparison
Feature | PSB | SBI Global Ed-Vantage | Union Bank | Bank of India Star Abroad |
Rate (abroad, above Rs 7.5L) | ~8.25-8.75% | 8.40-10% | 9-10.3% | 8.40-10% |
Max loan (abroad) | Rs 20 lakh standard | Rs 1.5 crore | Rs 1.5 crore | Rs 1.5 crore |
Processing fee | NIL (Rs 2,000 deposit, refundable) | NIL | NIL | Rs 10,000-20,000 (refundable) |
Co-applicant CIBIL minimum | Not publicly stated | 700+ typical | 650 stated | 700+ typical |
PSB Excellence/Premier scheme | Yes (no collateral for premier institutes) | Global Ed-Vantage (collateral-free for some) | No specific premier scheme | No specific premier scheme |
Moratorium concession | 1% if interest paid during moratorium | 1% concession (SBI scheme-dependent) | No specific moratorium concession | Confirm with branch |
PSB’s Rs 20 lakh cap is the primary limitation vs SBI and Union Bank which offer Rs 1.5 crore. However, PSB’s rates are among the most competitive for the IBA scheme, and its nil processing fee (refundable deposit model) is transparent.
Also Read: Compare Education Loan Interest Rates – All Lenders 2026
Compare PSB’s loan against 18+ lenders including higher-limit public banks and NBFCs. Compare Education Loans on GradRight
Punjab and Sind Bank Education Loan Eligibility
Criterion | Requirement |
Citizenship | Indian national or holder of Indian passport |
Age | No restriction for IBA scheme. Applicant can be a minor (with legal representation from parents/guardians). |
Admission | Confirmed admission to a recognized institution abroad through entrance test or merit-based selection |
Course eligibility | Professional/technical courses (IBA model). Diploma courses allowed. Vocational/skill development NOT eligible under IBA model (covered separately under Skill Loan). |
Co-applicant | Parents as joint borrowers mandatory. For PSB Excellence: both parents / one parent + one guardian / two guardians required. |
PSB Excellence qualification | Must be admitted to IIT, IIM, or an internationally AA or A-rated university. Not all institutions qualify. |
What Does the PSB Education Loan Cover?
- Tuition fees and admission fees
- Examination, library and laboratory fees
- Hostel/living expenses
- Books, stationery, equipment and instruments
- Laptop/computer if required for the course
- Travel expenses (passage money for studies abroad – airfare included)
- Study tours, project work, thesis expenses
- Any other reasonable expenses required to complete the course
Documents Required for Punjab and Sind Bank Education Loan
Student Documents
- Photocopies of all mark sheets up to current (Class 10, 12, graduation – all semesters). Bring originals for verification.
- Proof of admission photocopy (offer letter on institution letterhead acceptable)
- Probable expenditure / fee schedule from institution
- Passport photocopy (2 copies) and valid visa (mandatory for study abroad). Bring originals.
- PAN card and Aadhaar
- Address proof
Co-applicant / Parent Documents
- PAN card and Aadhaar
- Income proof: salary slips + Form 16 (salaried) or ITR (self-employed)
- Bank account statement – last 6 months (PSB account preferred; non-PSB account statements also accepted)
- Loan account statement for last 6 months if any existing loans
- Personal asset and liability statement
Additional for Collateral (above Rs 7.5 lakh)
- Property title documents with government-approved valuation certificate
- Assignment of future income document (PSB-specific requirement above Rs 7.5 lakh)
- FD certificates if FD used as collateral
How to Apply for PSB Education Loan
- Visit your nearest Punjab and Sind Bank branch. PSB has 1,466 branches with strong Punjab, Haryana, and Delhi NCR presence – 623 branches in Punjab alone.
- Alternatively, apply via Vidya Lakshmi Portal (vidyalakshmi.co.in): apply online, note your Application ID, and contact a PSB branch with the ID for further processing.
- Also reachable via PSB toll-free helpline: 1800 419 8300.
- Submit complete document set. Ensure you carry originals for verification along with attested photocopies.
- Deposit Rs 2,000 in a PSB savings account (this is not a processing fee – it is refunded after full loan disbursement; only forfeited if you do not avail the loan).
- Bank reviews and verifies. Standard public bank timeline: 15-25 working days.
- Receive sanction letter. Read all terms carefully before signing.
- Apply for government subsidies (CSIS, Padho Pardesh if eligible) at the time of first disbursement – not retroactively.
Government Subsidies Available on PSB Education Loans
Scheme | Eligibility | Benefit |
CSIS (Central Sector Interest Subsidy) | Family income < Rs 4.5 lakh. IBA scheme loan at PSB. | 0% moratorium interest – govt pays all interest while studying |
Padho Pardesh (Minority Community) | Minority community student. Family income < Rs 6 lakh. Studying abroad. | 0% moratorium interest for study abroad loans |
Dr Ambedkar Scheme (OBC/EBC) | OBC: income < Rs 3 lakh. EBC: income < Rs 1 lakh. Masters/PhD abroad. | 0% moratorium interest |
PM-Vidyalaxmi | Family income < Rs 8 lakh. Admission to QHEI. | 3% interest subvention during moratorium |
Apply for all relevant subsidies at the time of first disbursement through your PSB branch. Cannot be applied retroactively.
When Punjab and Sind Bank Makes Sense
PSB is a good fit when… | Consider other lenders when… |
You are in Punjab, Haryana, or Delhi NCR – PSB has its densest branch network here | You need more than Rs 20 lakh (most 2-year US/UK programs cost Rs 35-90 lakh total) |
You qualify for PSB Excellence (premier institute admit) – no collateral, no fee, 100% funding | You need larger amounts – SBI and Union Bank offer up to Rs 1.5 crore secured |
You can pay interest during moratorium and benefit from the 1% concession | You want a purely digital application process without branch visits |
You qualify for CSIS/Padho Pardesh subsidies (public bank is required) | Your university does not qualify as AA/A-rated for PSB Excellence scheme |
Also Read: IBA Model Education Loan Scheme – Complete Guide
Before finalizing PSB, compare with SBI, Union Bank and 15+ other lenders for your study abroad requirement. Compare Education Loans on GradRight
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