MCB Student Personal Loan (SPL)

LUMS has entered into an agreement with MCB Bank Limited through which MCB Bank provides commercial loans to MBA/ EMBA students.

The commercial loan facility is pivotal for students who are currently financially unable to afford the cost of tuition and living facilities. This is one of the first ventures of its kind in Pakistan and demonstrates LUMS' commitment towards providing equal educational opportunities to its students. 

All loans are subject to the Bank’s internal approvals and MCB Bank reserves the right to approve/disapprove a loan based on its internal assessment. In case a loan is not approved, students will be required to provide the total fees and expenses of the education themselves.

General Criteria

  • Pakistani nationals only.
  • At least 50% marks (or equivalent) in the last public examination (i.e. other than admission tests, e.g. GMAT, GRE, GAT, etc.). The same must be confirmed by LUMS in writing.
  • Confirmation of finalized admission by LUMS in writing.

Debt-Equity Ratio

  • Maximum 80:20 of admissible educational programme cost (such as admission, registration, tuition, on-campus residence, and any other part / head / item of the fees that is payable in advance by the student to LUMS).
  • Any amount that is refundable by LUMS to the student later on is not covered under the student loan programme  

Loan Amount

Subject to regulatory and internal bank requirements:

  • Maximum PKR 1 million.
  • In accordance with the schedule of fee payment, the above amount shall be disbursed over a maximum of 4 tranches in a way such that overall aforementioned maximum Debt-Equity Ratio is ensured:
    * Each tranche must ensure the aforementioned maximum Debt-Equity Ratio.
    * Each tranche disbursement would be subject to Bank’s review as per its requirement.


  • Only term loan (i.e. Running finance is NOT allowed).
  • Repayment in a maximum of 5 years from the date the loan becomes repayable.

Expected Time of Study Completion

The expected period of study will be the time during which the loan shall not become repayable. For regular and Executive LUMS MBA programmes, the same shall not be more than 2 years.

Repayment & Due Dates

Monthly repayment will be according to the provided schedule. The loan shall become repayable after around 6 months from the time of completion of study (as intimated by LUMS to MCB Bank). Therefore, first due date shall be January 1. Subsequent due dates shall be Feb 1, Mar 1, Apr 1, so on and so forth. For EMBA students, the loan shall become repayable immediately after graduation.

Mark-up Rate and Partial/Full Early Payments

  • Six-month KIBOR + 2.0%. This rate shall then undergo subsequent resetting on a six-monthly basis in accordance with the change in six-month KIBOR benchmark.
  • Mark-up accrual shall begin from the day of first disbursement as per the above rates and shall continue on the outstanding principal till the entire repayment of the loan.
  • Mark up accrual during the time of study will be done separately. Once the loan becomes repayable, the accrued mark up will be converted into a non-markup bearing term loan. Tenor of this term loan will be the same as the remaining tenor of the markup-bearing personal / term loan. Installments of both the markup and non-markup bearing term loans will be clubbed together for total installment payable by the student.
  • Early prepayment in full is allowed without any settlement charges.

Processing Fee

  • One time non-refundable processing fee of PKR 5,000/- or as set by the Bank only at the time of processing of the initial application.
  • Any applicable taxes / levies shall be recoverable from the customer/student /borrower.

Minimum Guarantees and Securities/Collateral

  • Personal guarantee of Parents/Guardian and/or any third party for each loan.
  • For each loan, assignment of all future incomes of the student to the Bank to the extent of the former’s liability to the latter.
  • In accordance with SBP regulations, loans shall be collateralized through any security /collateral as determined by the Bank for each loan and borrower.


Application form (pertinent to the relevant tranche) duly signed by the student, parents /guardian and/or third party guarantor(s) (as the case may be) and signed and stamped by the concerned LUMS officials.

  • CNIC or NICOP Copies of the Student and parent(s) / guardian(s) and/or any third party guarantor(s) as the case may be.
  • CF-1 Form / SBP Undertaking.
  • One-time activity of opening non-checking collection / repayment account along with irrevocable debit authority against this account.
  • Required legal documentation to be signed by the student and parent / guardian and/or any third party guarantor(s) as the case may be and with regards to various collaterals / securities.
  • Any other document as per MCB’s requirement.

Other Terms & Conditions

  • The student is not allowed to apply for any sort of loan from any financial institution / bank, without seeking prior permission from MCB until the first installment of the MCB Student Loan has been paid.
  • Disbursement shall be made directly to LUMS on account of the student.
  • If a student gets overseas employment, then his entire remaining personal loan and associated amounts shall become payable immediately to MCB.
  • Apart from the above, in cases where the student fails to complete the programme due to any reason, or drops out due to unsatisfactory academic performance or otherwise, or commits an act of moral turpitude or crime, the entire loan and associated amounts will become repayable immediately.
  • The entire loan and associated amounts will also become repayable immediately if, at any stage, any mis-representation or concealment of facts comes to the Bank’s knowledge.
  • Bank reserves the right to demand immediate payment of all outstanding amounts associated with the student loan at any time it deems appropriate.
  • In accordance with applicable laws and regulations, Bank reserves the right to take all measures and explore all options (which may include but may not be limited to litigation) for collection / recovery of all outstanding amounts associated with the loan from the student /borrower / guarantor(s) and any available collaterals / securities in case of non-payment /default and/or any non-fulfillment of contractual obligations by student / borrower /guarantor(s).


The above information is by no means comprehensive and is for the sole purpose of guiding the student / borrower /guarantors and, to the extent allowed under applicable laws and regulations, are subject to change as per MCB’s requirements at the latter’s sole discretion without prior notice to the student / borrower / guarantor(s). Moreover, the relevant loan documentation duly signed by the student / borrower / guarantor(s) and LUMS official(s) as per MCB’s requirement shall constitute as the final terms of reference for the parties involved.

‘MCB Bank shall continue to disburse Rs. 500,000/- to the E-MBA borrower student on annual basis. The E-MBA borrower student shall be eligible for availing SPL financing during the course of Module 2, 3, 4 and 5, subject to the condition that financing for each module shall not exceed Rs. 250,000/- and satisfactory progress reports.’