A moratorium delays scheduled repayment; it does not automatically make the loan interest-free. Rebuild the cost from each disbursement date, the rate applied, interest you serviced, any subsidy actually credited, and the lender’s capitalisation method. Ask for the ledger before the first EMI is fixed.
Start with each disbursement, not the sanction
Education loans are commonly released in tranches. List the amount and date of every release to the institution, vendor, blocked account, or borrower. Interest should follow the amount outstanding over time, so a calculation based on the full sanction from day one can overstate cost.
Read the moratorium clause word by word
Confirm when repayment starts, whether simple or compounded interest is charged during the study/grace period, when interest is debited, and whether servicing interest changes the later principal or any concession. Do not rely on the phrase “repayment holiday” without the formula and dates.
| Record | Use it to verify |
|---|---|
| Disbursement statement | Amount outstanding after each tranche |
| Loan ledger | Rate, interest debits, payments, and credits |
| Sanction/KFS/agreement | Moratorium and capitalisation method |
| New repayment schedule | Opening principal and EMI after moratorium |
Reconcile the opening repayment principal
Add actual disbursements and contractual interest, then subtract serviced interest and posted credits. Match that result to the opening principal on the revised schedule. RBI’s priority-sector clarification itself notes that education-loan outstanding can exceed the sanctioned limit because interest accrues during a study-period moratorium; the borrower still needs the account-level calculation.
Stop when the lender cannot show the arithmetic
- The schedule assumes money was disbursed before it actually was.
- Interest you paid is missing from the ledger.
- A subsidy or concession is promised but not posted.
- The rate or capitalisation method differs from the signed terms.
Complain with a dated reconciliation and exact correction requested. Preserve the undisputed payment obligation while the calculation is reviewed.
Official references
- RBI — Key Facts Statement for Loans and Advances — APR, charges and repayment schedule disclosures.
- RBI — Priority Sector Lending FAQ, Education — official clarification that accrued moratorium interest can raise education-loan outstanding.
- RBI Complaint Management System — eligible unresolved service complaints.