The Hindu Business Line : Andhra Bank aims at lending Rs 500 cr for education

With booming demand for loans for higher education and overseas study, Andhra Bank plans to disburse about Rs 500 crore as education loans this fiscal.

The bank has accounted for more than 10 per cent of the total education loans extended by banks in the country for higher education, Rs 1,389 crore of the total disbursement of Rs 13,000 crore.

Dr. K. Ramakrishnan, Chairman and Managing Director, said that the bank had earmarked Rs 300 crore under education loans for 2007-08 but expects this amount to go up to Rs 500 crore.

Speaking at a meeting hosted to release funds to students of 21st Century Gurukulam, Dr Ramakrishnan said that there is growing appetite for education loans from rural parts of the country.

He added that it is likely that the disbursement this year would be much larger in rural areas, up from Rs 120 crore.

Tie-ups with Biz schools

He said that tie-ups with educational institutions like Indian School of Business, Institute of Public Enterprise and BITS, Pilani have led to potential for accelerated growth. “Significantly, our experience shows that there is hardly any default when it comes to education loans. In fact, most of the payments are made ahead of the schedule as both the student and the parent are keen to exit them.”

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