Can loan was taken from dd essential


Sir, I am taking Education Loan for four Lakh and taking one lakh per annum for fees and hostel fees purpose. The Branch Manager said that he disbursed loan only D.D. Can it compulsory that I take loan amount in D.D. Manager refuse to transfer loan amount in my SB A/c. What can I do?


Under normal procedure banks disburse education loan only through DD in the name of institution or organization for studies, hostel etc. Banks release payments as schedule provided by the institution. As per terms and conditions of SBI’s Education loan for sanction and disbursement, it has been clearly mentioned “The loan to be disbursed in stages as per the requirement/demand directly to the Institutions/Vendors of books/equipments/ instruments to the extent possible”. Therefore banks allow an education loan to be paid through DD, directly to the institute. There are some expenses which can be included under education loan for which you can request for cash transferred to your saving accounts such as: travel expenses/passage money abroad, purchasing books, uniform, equipments etc. But final decision depends at sole discretion of bank as per its norms. So you can discuss with the bank and request as per requirement for an amount transferred to your SB A/c. You can also include cost of a two wheeler vehicle (up to Rs 50000) under the education loan and get disbursement for the same.


Hi Bestphoto,

Banks usually remit the fees directly to the institution in which you are looking to pursue studies. This could be in the form of a DD or direct credit to the institution’s account. The following expenses are usually covered.

• Fees payable to college/school/hostel

• Examination/Library/Laboratory fees

• Purchase of Books/Equipment/Instruments/Uniforms, Purchase of computers- essential for completion of the course (maximum 20% of the total tuition fees payable for completion of the course)

• Caution Deposit/Building Fund/Refundable Deposit (maximum 10% of tuition fees for the entire course)

• Travel Expenses/Passage money for studies abroad

• Cost of a two-wheeler upto Rs. 50,000/-

• Any other expenses required to complete the course like study tours, project work etc

However, some of these expenses might be paid to you. For example, SBI’s Global Ed-vantage Education Loan provides living expenses to the borrower by remitting it to the SBI Foreign Travel Card. Speak to your bank or check the terms and conditions of the loan.

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BB Expert