Kerala - Thiruvananthapuram   

Banks to allow defaulters’ wards to take education loan

Staff Reporter

THIRUVANANTHAPURAM: The children of those who have defaulted on repayment of loans taken from a bank will not be denied education loans from that bank.

This understanding was reached at a discussion between Minister for Education M.A. Baby and representatives from 11 banks held here on Saturday.

This year banks will give loans for payment of caution deposit for various professional courses.

This money will given by the bank directly to the educational institution concerned.

After the specified time the institution will pay the money back to the bank; the students will only have to pay the bank the interest on the loan, Mr. Baby told presspersons after the meeting.

It was also decided at the meeting that the admission of a student to a professional course will be eligibility enough for the sanctioning of an education loan.

The repayment of the loan will start only after the student completes the course. If the student gets a job immediately after the completion of the course, the repayment of the loan will begin six months after the course is over.

If not, repayment will only begin one year after the completion of the course.

For loans up to Rs.4 lakhs the interest rate will be 12.5 per cent. For loans ranging from Rs.4 lakhs to Rs.7 lakhs the interest rate will be 13.5 per cent.

For loans above Rs.7 lakhs the interest rate will be only 11.5 per cent, the Education Minister said. This rate for loans above Rs.7 lakhs will not be applicable in the case of all banks, the representative of a bank clarified after the press conference.

It was also decided at the meeting that a special officer will be appointed in each district to hear complaints relating to disbursal of education loans by various banks.

This is in addition to the special cell headed by the District Collector set up to guide students in getting education loans.

The contact details of these officers will be published in the media.

There will be nodal officers in the banks also to hear problems relating to sanction of education loans.

The Minister also reportedly asked the bankers to ensure that sanctioning of education loans is not unduly delayed; in any case the loans should be sanctioned within 10 to 15 days.

The banks that participated in Saturday’s meeting included the State Bank of Travancore, the State Bank of India, Canara Bank, IOB, Union Bank and the Apex Cooperative Bank. Principal Secretary, Higher Education, P. J. Thomas and Commissioner for Entrance Examinations B. S. Maoji were also present.

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