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Nearly 50 per cent drop in education loan beneficiaries

T. Ramakrishnan
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Income ceiling and insistence on collateral security could be among the reasons

Meant for weaker sections among the minorities, the Educational Loan Scheme, covering those pursuing technical/professional courses, has been drawing fewer students in the last three years.

In 2011-12, a total of 27 students availed themselves of the scheme. Last year, the number went down to 14. Since the launch of the scheme in 2008-2009, only 108 students have benefited and a mere Rs. 65.96 lakh disbursed as loans.

As per the scheme, students doing courses in government-recognised institutions get a maximum of Rs. 2.5 lakh for five years at the rate of Rs. 50,000 a year. Carrying an interest rate of three per cent, the scheme is administered by the Tamil Nadu Minorities Economic Development Corporation (TAMCO), which acts as the State Channelising Agency for the National Minorities Development and Finance Corporation (NMDFC). Amounts are disbursed through cooperative institutions, such as the District Central Cooperative Banks and Primary Agricultural Cooperative Banks. The ceiling of annual income of parents of students should be Rs. 40,000 in rural areas and Rs. 55,000 in urban areas.

Sources say that the income ceiling and insistence on collateral security could be among the reasons for fewer students using the scheme.

M.H. Jawahiruallah, Manithaneya Makkal Katchi (MMK) leader and Ramanathapuram MLA, says that the norms governing the scheme should be relaxed.

Acknowledging that the number of beneficiaries had fallen in the previous financial year compared to 2011-2012, A. Mohammedjan, Backward Classes and Minorities Welfare Minister, feels that the potential beneficiaries may be availing themselves of the educational loan scheme being run by nationalised banks.

Asked whether the State government has taken up with the Centre to revise the income ceiling, the Minister says the issue of revision of the ceiling is under consideration.

However, in respect of the merit-cum-means-based scholarship scheme, the number of beneficiaries last year was higher than the allocation made by the Union government for Tamil Nadu. As against the allocation of 2,301 students [Christians – 1,197; Muslims – 1,098 and Sikhs and Buddhists – three each], the actual number was 3,225 students [Christians – 1,577; Muslims – 1,646 and Sikh and Buddhist - 1 each].

Though the scheme is for students of professional/technical courses, only students of institutions notified by the Centre can apply for it. The institutions are IIT-Chennai, NIT-Tiruchi, Indian Institute of Technology and Design & Manufacturing (IIT&DM), Kancheepuram, National Institute of Fashion Technology, Chennai and IIM-Tiruchi.

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