SBI, short for “State Bank of India”, is the official bank of the Government of India. It’s been open since 1955 and has never had an interruption in operation.
As a result, especially in rural India, SBI is the most trusted bank, as it is viewed as an extension of the government itself. Many people open deposits with SBI, and when it’s time to apply for a loan, they go back to SBI to get it.
Whether you have a deposit with SBI, a loan with SBI, or both, an interest certificate is a document that you’ll have to become familiar with.
This article will explain everything you need to know about the SBI interest certificate.
So without any further ado, let’s get right into it.
What is an SBI Interest Certificate?
An SBI interest certificate is an official stamped document issued by SBI. It gives you an overview of all the interest you’ve earned from your deposits and all the interest you’ve paid on all your loan accounts.
You need the interest certificate to claim deductions under (various sections of) the Income Tax Act of India. Also, as we mentioned, the SBI interest certificate is an “overview”, without which you’ll have to look at multiple bank statements to find the same data.
Also, importantly, SBI interest certificates are dated to the previous financial year, whereas your bank statements or certificates of deposit are not. This makes doing the necessary calculations a lot easier
Additionally, you can get an SBI loan interest certificate, which only contains the interest that you’ve paid on education loans.
You can also get an SBI deposit interest certificate, which only contains the interest that you’ve earned on deposits that you hold with SBI.
Note: Even after you secure your education loan from a lender, such as SBI, you will need to interact with the bank or use their systems at various stages. It always helps to have someone reliable by your side, not just during your loan search but also for understanding and preparing for all follow-up interactions with the bank. To assist you in this, we have created FundRight (by GradRight).
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Next, let’s go back to the question at hand and find out why you might need an interest certificate.
Also Read: How to Get an Education Loan without Parental Support?
What are the uses of an Education Loan Interest Certificate from SBI?
An education loan interest certificate is a specialized document that outlines the interest you’ve paid on an SBI education loan. It usually only details the interest paid for one particular loan, but sometimes multiple loan accounts can be clubbed together on a single certificate.
So then, here are the main uses of an SBI interest certificate for your education loan:
- Tax Deduction: You need it to claim tax benefits under Section 80E of the Income Tax Act. It provides proof of the interest paid on your education loan. The SBI interest certificate helps you document this, making it easier to report the right figures on your tax return. For instance, education loan interest can be deducted under section 80E of the Income Tax Act. Also, home loan interest can be deducted (though this won’t be shown in an education loan certificate) under section 24(b).
- Loan Repayment Tracking: The certificate offers a record of the interest you’ve paid. This lets you plan your future repayments accurately, and also see how many repayments you’ve already made.
- Proof of Loan Repayment: The SBI education loan interest certificate serves as official proof of your loan repayments. This documentation can be particularly useful in future financial dealings, such as when applying for additional loans or seeking scholarships.
In the next section, we’ll teach you how to get an SBI interest certificate.
How to Obtain an SBI Interest Certificate?
Getting your SBI interest certificate is simple, and there are two main ways to do it: online or by visiting the branch in person. We’ll explain both methods step by step so you can decide which one works best for you.
Steps to Apply for an SBI Interest Certificate Online?
The easiest way to get your SBI loan interest certificate is online. Here’s what you need to do:
- Log in to SBI’s internet banking portal using your user ID and password. If you’re using the SBI YONO app, log in there instead.
- Once inside, look for the “Loans” section or menu.
- Find the option for an SBI loan interest certificate or interest certificate download.
- Choose the loan for which you need the certificate (like a home loan or education loan)
- Click “Generate” or “Download.” The certificate will be available for download right away in PDF format.
If you don’t have online banking, you can also do this via the SBI YONO app. It’s the same process: just head to the “Loans” section and download the certificate from there. This method is faster, and you can do it anytime.
Steps to Apply for an SBI Interest Certificate Offline
- Go to the branch and ask the bank staff for an SBI loan interest certificate.
- Provide details like your loan account number and identification.
- They’ll print the certificate for you on the spot.
This option works well if you need a hard copy or just prefer dealing with a person directly. It might take a little longer than the online method, but it gets the job done.
Also Read: What is Educational Loan Sanction Letter & How to Get Your Letter?
Difference Between SBI Interest Certificate and Form 16
When managing your taxes, you’ll have to fill out a document called “Form 16”. Now, Form 16 is not a replacement for your SBI interest certificate, nor can the SBI interest certificate replace Form 16.
The two documents are meant to complement each other. Here is a quick table that summarizes the differences between them:
| Aspect | SBI Interest Certificate | Form 16 |
| Issuer | State Bank of India (SBI) | Employer |
| Purpose | Details of interest paid on loans or earned on deposits | Summary of salary and tax deducted (TDS) |
| Used for | Claiming tax deductions on loan interest (e.g., home loan, education loan) | Filing overall income tax return |
| Tax Sections Covered | Section 24(b) for home loans, Section 80E for education loans | Section 80C and overall taxable income |
| Content | Interest paid, loan details, principal (if applicable) | Salary breakdown, TDS, taxable income |
| How to Get | Online via the SBI portal or branch visit | Provided by employer annually |
| Relevance | Important for those with SBI loans | Important for all salaried employees |
That was the short answer. If you want a more detailed explanation, read on.
What is an SBI Interest Certificate?
It is a document issued upon request by SBI to any person holding a loan or deposit account with them. The “master” certificate has the details of all interest paid as well as interest earned. Then, you can also get a deposit interest certificate, which only contains the interest received. And you can also get a loan interest certificate, which only details the interest you’ve paid to SBI.
What is Form 16?
Form 16, on the other hand, is a certificate issued by your employer, not the bank. This document outlines the details of the income you’ve earned and the taxes your employer has deducted (Tax Deducted at Source or TDS) over the financial year. Essentially, it’s proof of the tax you’ve already paid, based on your salary.
Form 16 is divided into two parts:
- Part A contains details like your PAN, your employer’s TAN, the amount of tax deducted and deposited with the government.
- Part B gives a detailed breakdown of your salary, including allowances, deductions (like those under Section 80C), and the total taxable income.
Thus, an SBI interest certificate is only about interest paid or earned, depending on the type of certificate. And Form 16 is about the taxes you’ve paid so far based on your salary.
Key differences:
- Issuer: The SBI Interest Certificate is given by the State Bank of India, whereas Form 16 is given by your employer.
- Purpose: Form 16 is to show the income tax department what your TDS (Tax Deducted at Source) has been, in the past financial year. An SBI interest certificate is to show you how much interest you’ve paid or earned during the year.
- Tax Filing: Form 16 is more general and applies to your overall salary. It helps you file accurate tax returns by acting as a “master” statement for your salaried income. An SBI interest certificate is very specific, only outlining details of your deposits with SBI, loan accounts with SBI, or both.
- Content: The SBI interest certificate contains details of the loan account, interest paid during the financial year, and any principal repayment (if applicable). It’s a straightforward document focused on the interest you’ve paid or earned. Form 16 covers taxable income, TDS, and any deductions made against your taxable income (salary).
- Availability: You can get the SBI interest certificate online through internet banking or by visiting your branch, as explained earlier. Form 16 is provided by your employer at the end of the financial year.
- When Do You Need Each?
- You’ll need the SBI interest certificate when you’re claiming deductions on loans.
- You’ll need Form 16 when you’re filing your overall income tax return.
And with that, we come to the end of this article on SBI interest certificates.
Frequently Asked Questions
Whether for home loans, savings accounts, deposits, or education loans, the process is the same. Here’s how to go about it: Visit the SBI online banking portal and log in using your credentials. Once logged in, look for the My Certificates section in the menu. Choose the type of interest certificate you need—whether it’s for savings accounts, fixed deposits, or loans. Specify the financial year or date range for which you want the certificate. After generating the certificate, you can download it as a PDF.
These are mainly used for reducing your taxable income under the Income Tax Act. Home loans are exempted under section 24(b) and education loans under section 80E. Only the interest part is deductible though, so remember that. Also, interest certificates can serve as proof of repayment, or in financial jargon, as “proof of no default”. This can be useful when applying for additional loans or scholarships.
This is a stamped document issued upon request by SBI to any person holding a loan or deposit account with them. The “master” certificate has the details of all interest paid as well as interest earned. Then, you can also get a deposit interest certificate, which only contains the interest received. And you can also get a loan interest certificate, which only details the interest you’ve paid to SBI. Without the interest certificate, you’d have to analyze various loan account statements and deposit statements, find the correct amounts and tally them up. The SBI interest certificate makes things easy by giving you a “snapshot” of all your interest paid or earned during the previous financial year.
You typically need the SBI interest certificate once a year, around tax season, to file your return. However, it’s a good idea to download it periodically to track your loan repayment status. The closer you get to closing out your loan, the more frequently you should be checking your interest certificate.
Yes, you can get separate SBI interest certificates for multiple loans. If you have both a home loan and an education loan, for instance, you can request or download certificates for each one. This is important because the deductions for each loan fall under different sections of the Income Tax Act.
