The Educational Loanees Association has urged the government to restructure the loans to provide debt relief to loanees. The organisation has sought measures akin to the ones provided for debt relief to fishermen.
Association district president Poly Thomas said here on Friday that banks had initiated recovery procedures, as the moratorium on repayment, permitted by the government, had ended on June 30.
He said the government scheme for waiver of penal interest was not of much help. An official proposal for extending the period of repayment would be of little benefit as it would incur additional interest. Instead, the loan could be permitted to be repaid in 10-12 instalments within a year without interest. In such a scenario, about 90 per cent of loan defaults would be cleared, he said.
Mr. Thomas said the State Budget had set apart money for waiver of interest on loan for the past three years. The Centre had allocated Rs.2,600 crore for providing relief to loanees. The scheme benefited only those who could make use of one-time settlement. He demanded that the government appoint a commission, similar to the one appointed for fishermen’s debt relief, and conduct sittings in all districts.
‘After the June 30 deadline for repayment, banks have initiated recovery procedures’
