As per Indian Banks’ Association (IBA) Model Scheme, approved courses leading to graduate/ post graduate degree and P G Diploma conducted by Colleges/ Universities recognized by the University Grants Commission, the All India Council for Technical Education, the Indian Council of Medical Research, etc. are eligible for education loan. Model education loan scheme covers recognized non professional courses. 

Complaints regarding educational loans, as and when received by the Government, are taken up with banks concerned for corrective action. As informed by Public Sector Banks, during 2016-17 (upto December, 2016), 2608 complaints related to education loans were received, out of which 2497 were disposed off. In order to facilitate easy processing and disbursal of loans, Government has launched a web-based portal namely, Vidya Lakshmi Portal. Students can view, apply and track the education loan applications online by accessing the portal. 

All education loans upto ₹ 4 Lakh are collateral free as per RBI guidelines. Further, Government of India has launched a Credit Guarantee Fund Scheme for Education Loans (CGFSEL) wherein collateral free loan is given upto ₹ 7.5 lakh. 

As per IBA Model Scheme, Education Loan Limit is ₹ 10 Lakh for studies in India and ₹ 20 Lakh for abroad studies. However, Banks may consider capping stream wise/ institution wise cap on education loan amount by taking into account reputation and placement history of the education institution concerned. Banks may consider higher quantum of loan on course to course basis. 

This was stated by Shri Santosh Kumar Gangwar, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha.

Collateral-free education loans expanded, with enhanced guarantee scheme and model limits affecting loan quantum and bank discretion. Education loan eligibility under the IBA Model covers recognised graduate, postgraduate and diploma courses and recognised non professional courses; Vidya Lakshmi Portal enables online application tracking. RBI guidelines provide collateral free loans up to prescribed thresholds, and the Credit Guarantee Fund Scheme for Education Loans expands collateral free coverage. The IBA Model sets indicative loan ceilings for domestic and foreign study while allowing banks to impose institution or stream wise caps and consider higher quantum on a course by course basis.