For Educational purposes bank offer loans. This loan is
encouragingly taken by those students who want to pursue higher studies or want
to go abroad for educational purposes. The loans are offered for perusing
professional or higher education. Like any other loans offered interest is
charged education loans too that varies from bank to bank. Rate of interest
offered by banks for education loans is quite high than other. Banks take huge
risk and the repayment only starts after course is complete hence the interest
is high. Though the interest rate comes down if there is regular payment
without defaults and part of interest is paid during the course.
Summary:
The profits gained by the bank from interest are used to
provide loans to more students perusing education. The interest paid must be
seen as return to society enabling others to pursue dreams.
