The Dr. Ambedkar Central Sector Scheme of Interest Subsidy on Educational Loans offers a unique opportunity for OBC (Other Backward Classes) and EBC (Economically Backward Classes) students aspiring to pursue Master’s, M.Phil., or PhD programs abroad. Launched by the Ministry of Social Justice and Empowerment, this scheme helps ease the financial burden by subsidizing interest on education loans during the moratorium period.
Overview of Dr Ambedkar Central Sector Scheme
• Name of Scheme: Dr. Ambedkar Central Sector Interest Subsidy Scheme
• Launched By: Ministry of Social Justice and Empowerment
• Target Beneficiaries: Students from OBC and EBC categories
• Course Levels Covered: Master’s, M.Phil., PhD (abroad only)
• Max Loan Eligible for Subsidy: ₹20,00,000
• Subsidy Period: Entire moratorium (course duration + 1 year or 6 months after employment)
• Application Mode: Offline (via Nodal Bank/linked to IBA Loan)
• Special Provision: 50% of annual outlay reserved for female candidates
Objective
To support meritorious OBC and EBC students by subsidizing the interest on educational loans for approved postgraduate and doctoral studies abroad, enabling better access to international education, and enhancing employability.
Benefits of the Scheme
• Full interest subsidy on education loans during the moratorium period.
• No repayment of interest required during the course + 1 year (or 6 months post-job).
• Subsidy up to ₹20,00,000 worth of education loan.
• Girl students get priority, with a minimum 50% allocation of the total budget.
• Helps students from economically weaker sections achieve global educational exposure.
Eligibility Criteria
• Must be an Indian citizen and a student seeking to pursue higher studies abroad.
• Must belong to the OBC or EBC category.
• Annual family income must not exceed ₹8,00,000.
• Must have secured admission in a recognized Master’s, M.Phil., or PhD program abroad.
• Must have taken a loan from a scheduled bank under the IBA Education Loan Scheme.
• The loan must be for courses listed and approved under the scheme.
How to Apply – Offline Mode
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Loan Sanction: Ensure you’ve taken an education loan under the IBA scheme from a scheduled bank for approved foreign courses.
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Application Procedure:
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Linked with the IBA scheme; details and process laid down by the Nodal Bank.
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Application for interest subsidy to be routed via the Nodal Bank.
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Screening & Recommendation:
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Applications are reviewed quarterly by a Recommending Committee led by the Joint Secretary of the Backward Classes Division.
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Includes representatives from the Finance Division, the Nodal Bank, and the ministry.
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Fund Disbursement: Subsidy is released on a first-come-first-served basis, depending on the annual budget availability.
Essential Documents for Application
• Recent Passport-sized Photograph
• Aadhaar Number
• Proof of Educational Qualification
• Bonafide Certificate from an institution abroad
• OBC Caste Certificate in prescribed format (for OBC category)
• Income Certificate (via ITR/Form 16/Audited Accounts or State Authority)
• Details of Aadhaar-linked Bank Account
Frequently Asked Questions (FAQs)
Q: Is there a special allocation for girl students?
A: Yes, at least 50% of the total budget is reserved for female students.
Q: Are part-India, part-abroad courses eligible?
A: No, only full-time courses abroad are eligible for subsidy.
Q: What is the maximum loan covered for subsidy?
A: A maximum of ₹20,00,000 is eligible for interest subsidy.
Q: Who implements the scheme?
A: The scheme is implemented through a Nodal Bank in consultation with the Ministry of Social Justice & Empowerment.
Q: What happens after the moratorium ends?
A: Students must repay the principal + interest as per the original loan agreement.
Q: How is “meritorious student” defined?
A: Based on admission to approved courses abroad, no explicit merit marks cutoff.
Q: Can working students apply?
A: Yes, but the subsidy only covers interest during the moratorium, not post-employment.
Sources & References
• Scheme Guidelines – Ministry of Social Justice & Empowerment
• [Income Criteria Amendment Document]
• UMANG Portal – Check Claim Details
Conclusion
The Dr. Ambedkar Interest Subsidy Scheme is a valuable opportunity for OBC and EBC students aspiring for global education but facing financial constraints. With a generous moratorium-period subsidy and a straightforward application process, the scheme enables access to world-class institutions and increases employability for underrepresented communities. Eligible students should approach their bank and apply early to take advantage of the first-come-first-served allocation.
