Padho Pardesh Scheme- A Scheme of Interest Subsidy On education loan

It was announced in June, 2006. It provides the scholarships for
meritorious students from minority communities will be formulated and implemented. The scheme of Interest Subsidy on educational loans for overseas studies will promote educational advancement of student from minority communities.


i) The Scheme is applicable for higher studies abroad. The interest Subsidy shall be linked with the existing Educational Loan Scheme of Indian Banks’ Association (IBA) and restricted to students enrolled for course at Masters, M.Phil and Ph.D levels.
ii) The interest subsidy under the scheme shall be available to the eligible students only once, either for Masters, M.Phil. or Ph.D. levels. Interest subsidy shall not be available to those students who either discontinued the course mid- stream, due to any reason, or those who are expelled from the institutions on disciplinary or academic grounds.
iii) If it is found that a student has violated any condition of the scheme, the subsidy will be discontinued forthwith.

iv) If a student is found to have obtained the subsidy by false
statement/documents/certificates, the subsidy will be withdrawn/cancelled forthwith and amount of the subsidy paid already, shall be recovered with penal interest, apart from taking criminal action as per law.
v) The students obtaining benefits under this Scheme shall not be given the interest subsidy if he gives up Indian citizenship during the tenure of the period.


The student should have secured admission in the approved courses at Masters, M.Phil or Ph.D levels abroad for the courses. He/ She should have availed loan from a scheduled bank under the Education Loan Scheme of the Indian Banks Association (IBA) for the purpose. Students should apply for the benefits under the scheme during 1st year itself of the course. Fresh applications received during 2nd year or subsequent years will not
be accepted in any case.

i) Total income from all sources of the employed candidate or his/ her
parents/guardians in case of unemployed candidate shall not exceed Rs. 6.00 lakh per annum.
ii) Income certificate issued by the competent authority in the State/ Union Territory should be submitted in support of income shown by a candidate.

i) 35% seats will be earmarked for girl students. In case of non-availability of girl students, seats can be transferred to boys students.
ii) The decision of the Selection Committee in regard to awarding the interest subsidy will be final and no appeal could be filed against it.

(i) Under the scheme, interest payable by the students availing of the education loans of the IBA for the period of moratorium (i.e. course period, plus one year or six months after getting job, whichever is earlier) as prescribed under the Education
Loan Scheme of the IBA, shall be borne by the Government of India.
(ii) After the period of moratorium is over, the interest on the outstanding loan amount shall be paid by the student, in accordance with the existing Educational Loan Scheme as may be amended from time to time.
(iii) The Candidate will bear the Principal installments and interest beyond moratorium period.

How to apply:

First, you need to avail the study loan from your chosen lender, and then apply for the Padho Pardesh scheme.

Submit all the relevant documents to your lender stating that you’re eligible for the interest subsidy scheme.

The lending organisation shall submit your personal information as well as education loan details on the scheme’s portal.