Good news has come from the Ministry of Finance for the promising students of the weaker sections. The Finance Ministry has directed all public sector banks (PSB) to accelerate the process of education loan. In addition, the Ministry has also asked banks to create centralized credit processing systems. Earlier, the government has expressed concern over the issue of delay in loan distribution. Following the government’s directive, banks are also faster connecting with Vidya Laxmi portal.
Loan will be available in 15 days on government instructions
Following the instructions of the Finance Ministry, bank education is accelerating the process of loan. The government has directed the PSB to complete the education loan process in 15 days, for which students have to wait for a month. According to the instructions of the ministry, only the senior officer can approve it if the loan rejects or returns due to any reason. Also, its clear information will have to be shared with the applicant.
Decrease in giving loan
In the last two financial years, the application of education loan has declined by 14.5%, while the amount allocated as a loan has decreased by 13%. In FY 2022-23, 7,36,580 students applied for education loans and Rs 28,699 crore was distributed as a loan. At the same time, FY 2023-24 It declined to 6,29,594. This year Rs 24,997 crore has been given in education loan.
The interest rate is 7 to 16% on education loan
Private and public sector banks in the country are currently providing education loans at 7 to 16% interest rates. Whereas in rural banks it is 8.50 to 13.60%. While studying in your country, where education loan up to Rs 50 lakh is received, you get a loan of up to Rs 1 crore on a course abroad. This loan is taken for UG, PG, Professional, Diploma and Skill Based Course. It can be repaid over a period of 15 years. Its interest gives a discount of up to 8 years under Section 80E of Income Tax. In addition, collateral security is necessary for a large amount of loan. The Mooretorium period of the education loan ranges from 6 months to 1 year after completion of the course.
Vidya Lakshmi Portal made process easier
The government’s Vidya Lakshmi portal is a single window portal, making the process of education loans easy and transparent. On this, students can learn about the education loan of many banks in one place, compare and apply. The Department of Financial Services, Department of Higher Education and Indian Bank have prepared and NSDL-Egav operates it.