Needed: uniform interest rates
LAIQH A. KHAN
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Karnataka Govt. has asked banks to come to a consensus on the issue
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The Karnataka Government has called upon the banks offering education loans to students to have a uniform rate of interest.
A senior official of the Higher Education Department said “The rate of interest on educational loans ranges from 10.5 to 13 per cent. So, we have told them to come to a consensus and fix a uniform rate.”
The differential interest rate came up for discussion even during the recent meeting Chief Minister B.S. Yeddyurappa had with Minister for Higher Education Aravind Limbavali.
Meeting sought
The Chief Minister has asked the Higher Education Department to facilitate a meeting of the State Level Bankers’ Committee (SLBC) to review the interest rates so that a uniform rate can be fixed by all the banks.
Uniformity will not only clear the confusion prevailing in the minds of students and their parents over the rates of interest charged by different banks, but also help the Government pay a uniform subsidy to the banks for the education loans obtained at six per cent by CET students securing seats in Government colleges and Government quota seats in private colleges.
The remainder of the interest portion is paid to the banks in the form of subsidy. A senior official in the Higher Education Department said the Government order in the regard is clear.
Though it is convenient for students as well as the Government if the banks have a uniform interest rate for the education loans, the official felt that the State Government cannot force the banks to do its bidding. “Each bank has the freedom to fix an interest rate of its choice. But, we are only hoping they will have a uniform rate in the interest of the students and the Government,” the official added.
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