Banks have till date claimed ₹ 1,607 crore from the central government under the interest waiver scheme announced for certain education loans in the interim budget 2014-15.

This amount related to 3, 10,434 students, Nirmala Sitharaman, Minister of State for Finance informed the Lok Sabha in a written reply on Friday.

Under this interest waiver scheme, the erstwhile finance minister P Chidambaram had sought to provide benefit to those students who had taken education loan upto March 31, 2009 which is outstanding as on March 31, 2013 to the extent of interest component.

Government had in the interim budget said that it will take over the liability for outstanding interest as on December 31, 2013, but the borrower would have to pay interest for the period after January 1, 2014. A budget provision of ₹ 2,600 crore under non-plan scheme had been provided.

This scheme is being implemented on the same guidelines as are applicable under the central scheme to provide interest subsidy (CSIS) with respect to the income, eligibility, courses applicable and other such operational issues.

Under the CSIS, full interest subsidy is provided during the period of moratorium (course period plus one year or six months after getting the job, whichever is earlier) on education loans taken by students belonging to economically weaker sections from scheduled banks.

The educations are to be given for pursuing approved courses of studies in technical and professional streams from recognised institutions in India. The loans should be disbursed after April 1, 2009 and the annual gross parental/family income upper limit should be ₹ 4.5 lakhs from all sources.

The interest rates on education loans ranges from 10.20 percent to 14.25 percent depending upon the base rate and the quantum of loan.

Till 2012-13, an aggregate interest subsidy of ₹ 3913 crore has been provided to 36.03 lakh students under the CSIS scheme.

>Srivats.kr@thehindu.co.in

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