1. When do I start paying my EMI?

HDFC Credila's unique education loan offers the flexibility of paying only simple interest (PEMI) during the course period and principle plus interest (EMI) after the completion of studies and grace period.

2. How do you decide on repayment period?

The repayment periods are generally driven by our evaluation of the student's potential earning capability and risks we perceive in extending any particular loan.
At HDFC Credila, we understand that students want to start repaying loans immediately after they get a job. However, they may find higher EMI's (due to shorter repayment periods) at the start of their careers, very challenging. Thus we offer longer tenure to facilitate smooth transition of student from campus to corporate. This way they can start their earning and professional lives with positive credit histories that help them to take other loans in future.

3. How is interest calculated?

Interest may be calculated on daily, monthly or yearly reducing principle basis

4. What are the calculations that you do since repayment is usually after the person has graduated or got a job?

Education loans are structured with either complete moratorium during the course or only principle moratorium. Usually, 6 months to 1 year of grace period is also extended after the course for the student to search for a job

5. Can repayment period be extended?

Yes, based on the genuine reasons it can be. We can review this on a case to case basis.

6. What if the applicant gives up studies half way?

He/she will have either close the loan by paying full amount or keep repaying monthly installments on time to avoid becoming a defaulter and ruin their own credit history

7. Usually, banks asks to pay after course but HDFC Credila asked me to pay at least interest amount during the course. Why so?

It's for the benefit of students and parents. HDFC Credila offers simple interest rates. Compounding of interest adds financial burden and unnecessarily parents and students have to bear a large burden of interest on interest. HDFC Credila thinks that it's helpful for the students not to pay interest on interest. Therefore, HDFC Credila products require at least the interest payment on the loan during the study period.
HDFC Credila charges simple interest rate. HDFC Credila also believes that this reduces the burden on students and parents. It's very important to set in financial discipline for the students. HDFC Credila has noticed that once interest on interest is avoided, students and parents feel quite comfortable dealing with the EMIs of the loan. It helps students also since there are many other expenses to take care of after the student gets the first job.

8. Can I pay upfront interest in one shot of my course duration, so that my parents are not burdened to pay interest every month during my course?

Yes. There is an option available for upfront interest also depending upon the course and underlying demographics of the student.

9. Does HDFC Credila offer part closure/ foreclosure? If yes, what are the charges? RBI has asked banks not to charge such fees, is HDFC Credila covered under this?

HDFC Credila allows students and parents to make part payments or foreclosures on the education loans. HDFC Credila is compliant with all NBFC related guidelines.

10. Is there a concession if the loan is paid during the study period?

Yes, normally the pricing is designed to encourage at least simple interest repayment during the course period. This helps the students/parents:

• Get the income tax benefit on the interest paid
• Save the money on accrued interest (in case of complete moratorium) that gets capitalized and eventually the total outflow may be relatively higher
• Repaying interest during the course period also helps build a sense of financial responsibility in the student

11. Give an example. Say a person is applying for a Rs 12lakh-domestic will repayment work, for how many years, what would be the interest rate, down-payment. Give a similar break up for an international loan of Rs 20 lakhs?

The simple interest repayment, which is a relatively smaller amount per month, starts immediately. And post the course and grace period (time given by lenders to student for searching a job after course), the regular repayment starts in the form of equated monthly instalments (EMIs).