What is solvency certificate and how to get the solvency certificate from Indian banks?

In this article, you will find all the necessary details regarding obtaining a solvency certificate from bank. For most US Universities, you will need to send this document while applying itself as proof of funds.

What is difference between bank solvency certificate and company solvency certificate?
By definition, a solvency certificate is a proof of solvency which means that the person’s assets are more than his liabilities. Most often the solvency certificate is required by the companies for auditing purpose. A bank may issue solvency certificate to individuals stating the total amount of assets held by the individual. This is particularly useful for students who wish to pursue higher education abroad as most Universities require this certificate.

Procedure to apply for a bank solvency certificate
  1. Contact your bank where you have savings account. Check with all the documents that are required as proof of funds to put in your solvency certificate.
  2. Get your property or apartment evaluated from Municipal Corporation or any property agent. Generally agents charge about Rs. 1000 for flat valuation.
  3. If you are including gold in the funds proof, you can get your gold evaluated from your gold dealer or any jeweller. They charge about 0.5 to 1 per cent of evaluated amount.
  4. Take the photocopies of all the documents required. For e.g. you will require the photocopy of your fixed deposit receipt, property evaluation document, etc.
  5. Submit all the photocopies along with a duly filled form to your bank. Take the originals along with you which is required for verification
  6. The bank official will evaluate all your documents and accept your form and will provide the details of payment based on the number of copies of the bank solvency certificate. Ordinarily banks charge about Rs. 750 for solvency certificate and Rs. 100 for every extra copy.
  7. It is advisable to get about 10 copies of the bank solvency certificate. The bank will provide these copies after 3-4 working days.  

List of allowed sources of funds that can be showed in the solvency amount for banks
  1. Savings Accounts
  2. Company Provident Fund Account
  3. Public Provident Fund
  4. Fixed Deposits
  5. Mutual Funds at current valuation
  6. Shares at current valuation
  7. Gold at current valuation
  8. Property or flat after valuation

The above list of accepted sources of funds for solvency certificate might not be true for all banks. Some banks might not accept Gold or property valuation for solvency certificate. You need to contact your bank for solvency certificate details. But in general, all these sources of funds are accepted by most banks.

Solvency Certificate not accepted by some Universities
Read the University guidelines carefully as some US Universities might not accept solvency certificate from banks or chartered accountant in India. Some Universities require entire financial proof in liquid assets.

Sanctioned Education loan as an alternative to Solvency certificate for US Universities
Many US Universities require a solvency certificate only after you have received admit from that University. Hence, you need to send the solvency certificate only after March when you start receiving admits. If your education loan is sanctioned by that time, you can send the sanctioned education loan document obtained from your bank as solvency certificate. Your University will issue the I-20 document based on this document.
Most nationalised banks require I-20 document before your loan is sanctioned. But, you can get an education loan based on your admission decision letter. Banks have started providing sanctioned loan document with a clause mentioning the requirement of I-20 from University before disbursement of the amount.

Sample bank solvency certificate for Indian applicants to US Universities
To download free sample bank solvency certificate click on the following download link: