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Federal Government education loan (Bildungskredit)

The Federal Government’s education loan programme provides a low-interest loan to support students in advanced stages of their education. To be eligible for the loan, students must have passed any intermediate exam, completed the first part of a consecutive programme or be in the process of completing a postgraduate diploma, Master’s or Magister degree.

Outline

  • The education loan of 300 €/month is granted for a maximum of 24 months.
  • If financing is required for an exceptional expense, it is possible for one part of the loan to be paid out in advance as a lump sum equivalent to up to six instalments.
  • German school pupils, students and trainees, and under certain conditions also foreign trainees, are eligible to apply. Applicants must be of legal age, but the loan is only granted up to the age of 36.
  • The loan is not dependent on income. However, assistance is only provided for training that is also recognised under BAföG.

Application and repayments

  • Application: an application for the education loan is made in writing to the Federal Office of Administration (Bundesverwaltungsamt), where the eligibility criteria are assessed. If the criteria are met, the applicant receives notification that the loan has been approved and is entitled to sign a loan agreement under private law with the KfW Bankengruppe (Kreditanstalt für Wiederaufbau).
  • Interest rate: the loan is subject to the favourable European Interbank Offered Rate (EURIBOR), plus a surcharge of one percent (as of 01.04.2008: 5.81 % effective).
  • Repayments: the education loan plus interest is repaid to the KfW Bankengruppe in monthly instalments of 120 € over a period of four years from the date of the first loan disbursement. However, it can also be paid back earlier, either fully or in part.

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