Union Home Minister P. Chidambaram expressed hope that the volume of education loan will touch Rs.50,000 crore in 2015 owing to opening of new higher learning institutes in the country.
Speaking at a function organised by the Indian Overseas Bank (IOB), in which all nationalised banks put up stalls to distribute loans to the students at Karaikudi near here on Saturday, he said the government planned to open new Indian Institutes of Technology and Indian Institutes of Management in different parts of the country.
Education loans totalling Rs.24,000 crore had been disbursed to 16 lakh students across the country till March 2009. He was confident that it might double and even touch Rs.50,000 crore within 2015.
Mr. Chidambaram said the Centre had decided not to collect interest on education loan availed of by those whose family income was less than Rs.4.5 lakh per annum. The benefit would be given to them during the period of the course and 6 months after that. The scheme would come into force from the current academic year itself. It meant that there was no need for them to pay interest for 4 to 5 years.
He added that there was no rule for the bankers to deny educational loan citing service area limit as a reason. When he wrote a letter to the Indian Bankers Association to know their view on area limitation problem in sanctioning education loan, they replied the bankers could certainly sanction loan irrespective of service area.
S.A. Bhat, Chairman and Managing Director, Indian Overseas Bank, said the total business of bank, which was started at Karaikudi in 1937, had gone up to Rs.1.77 lakh crore. It had been growing at 20 per cent per annum.