Ac­ces­si­ble for Bor­rower and Safer for Lender

Consumer Voice - - Bfsi -

There have been a slew of di­rec­tions/guide­lines in the mat­ter of en­abling stu­dents to get ed­u­ca­tion loans faster as well as banks feel­ing safe in ex­tend­ing such loans to stu­dents (in spite of their sta­tus as non­earn­ing in­di­vid­u­als). Th­ese di­rec­tions/guide­lines are sum­marised be­low:

Model IBA ed­u­ca­tion loan scheme for pur­su­ing higher ed­u­ca­tion in In­dia and abroad

Banks are now ex­pected to ex­pe­dite ed­u­ca­tion loan sanc­tion with­out de­lay. The IBA scheme pro­vides for fi­nance as un­der: Stud­ies in In­dia up to Rs 10 lakhs Stud­ies abroad up to Rs 20 lakhs There are moves to in­crease the quan­tum of fi­nance, from the cur­rent Rs 4 lakhs to Rs 7.50 lakhs, with­out the re­quire­ment of pro­vid­ing se­cu­rity or third-party surety. A Credit Guar­an­tee Fund Scheme for Ed­u­ca­tion Loans (CGFSEL) has been es­tab­lished to guar­an­tee ed­u­ca­tion loans sanc­tioned by mem­ber

In or­der to bring in sim­pli­fied norms of lend­ing cou­pled with stricter mon­i­tor­ing of un­cer­ti­fied ed­u­ca­tional in­sti­tutes, the govern­ment of In­dia has brought out a no­ti­fi­ca­tion (dated 16.09.2015) to es­tab­lish Credit Guar­an­tee Fund Scheme for Ed­u­ca­tion Loans (CGFSEL). Banks are ex­pected to in­crease their loan vol­ume and num­bers in ex­tend­ing ed­u­ca­tion loans to needy stu­dents for pur­su­ing fur­ther stud­ies in In­dia and abroad.

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