Many leading Indian educational institutions have tie-ups with banks for educational loans to enable working professionals to pursue mid-career courses, making the loan process smoother and quicker.

State Bank of India [Get Quote] (SBI) has tie-ups with all the Indian Institute of Management (IIMs), the Indian Institute of Technology (IITs) and Indian School of Business, Hyderabad. Bank of India has tie-ups with institutions like IIMs and computer training institutes like NIIT [Get Quote].

Bank of Baroda [Get Quote] has a special scheme for funding executive education called 'Baroda Loan for Executive Development'. SBI also provides loans for mid-career courses in other educational institutions, both in India and abroad.

"Expanding Indian businesses have increased the demand for new skills and qualified professionals, resulting in demand for educational loans," said an SBI official. He also said that around 80 per cent of SBI's educational loans are for domestic courses.

SBI registered 30 per cent growth in its education loan portfolio to Rs 3,220 crore (Rs 32.20 billion) in 2006-07.

According to a Bank of India official, almost 70 per cent of education loans were taken for domestic courses mainly for MBA, MBBS, engineering, hospitality and other post graduate degrees. BoI recorded 20 per cent growth in its educational loan portfolio in 2006-07 to Rs 700 crore (Rs 7 billion).

SBI offers education loans of sizes ranging from Rs 20,000 to Rs 15 lakh. The average ticket size of a domestic education loan is Rs 2 lakh to Rs 3 lakh, while that of an overseas one is Rs 10 lakh. The tenure ranges from five to ten years. Repayment usually starts from one year after completing the course or six months after securing a job, whichever is earlier.

Mid-career management programmes (up to one year) offered by leading Indian business schools cost between Rs 40,000 and Rs 2 lakh. Shorter duration courses cost less. However, short-duration courses conducted by premier institutes may set you back by more than Rs 1 lakh. For instance, the six-month programme conducted by IIM-Ahmedabad costs Rs 1.8 lakh, which can be funded through a bank loan.

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