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Mony K. Mathew

Thiruvananthapuram , Oct. 18

NEW private sector banks in Kerala have been taking it rather easy when it comes to the question of granting education loans to eligible students in the State.

This was despite a special meeting of banks convened by the Chief Minister, Mr Oommen Chandy, in August this year to discuss the education loan scenario in the State and to take urgent steps to ensure smooth dispensation of the loans.

The State Level Bankers Committee (SLBC), which met here recently, had taken note of this trend among the new private sector banks. Even though the Convenor of SLBC had earlier written to the banks on the matter, none of them responded except IDBI Bank.

As per the data on education loans for the last three years till June 30 this year, the total amount disbursed in the State was Rs 879.44 crore. Out of this, the State Bank group accounted for Rs 439.98 crore.

The share of the nationalised banks was Rs 343.80 crore, while the regional rural banks such as the North Malabar Gramin Bank and the South Malabar Gramin Bank disbursed Rs 13.38 crore. The total outstandings of all the public sector banks put together amounted to Rs 797.15 crore.

On the other hand, the contribution of the private sector banks to the total amount of education loans disbursed in the State was Rs 77.77 crore. Out of this, the share of the new private sector banks was below Rs 25 lakhs. This, too, was accounted for by a couple of banks, while majority of the new generation banks drew a blank.

It has also been pointed out that though there are clear directions from the Centre and the Indian Banks Association regarding the eligibility criteria for granting of education loans, there exists no uniformity among the banks in the matter. Some of the banks have been refusing loans for general nursing courses.

The SLBC meeting was informed that IDBI Bank had responded to the letter from the Convenor on the question of extending education loans.

The bank had said that it was in the process of charting out its policy on priority sector lending, including education loans. It said it would take up the issue of education loans as soon as its retail-lending set-up in the State was in place.

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