Money & Banking

Banks told to brief public on education loans

Our Bureau Thiruvananthapuram | Updated on May 10, 2011 Published on May 10, 2011

Stakeholders in the banking industry have been told to take the public into confidence over the state of the industry, with particular reference to education loans.

While speaking at the District Consultative Committee for Banking Development here, Mr A. Sampath, Member of Parliament, alluded to growth of non-performing assets in education loan accounts.

Mr Sampath said there was a need for the public to not just being aware of the state of the industry, but also to stay clear of middlemen who swoop on students with offers of admissions in institutions with dubious credentials and based outside of the State.

Dr Dinesh Arora, District Collector, said in his presidential address that banks in the district would soon organise special camps at the branch level to raise awareness on the subject.

Meanwhile, Mr Sampath also called on banks to step up disbursement of education loans. Representatives of banks responded by saying that several students were finding it difficult to service existing loans.

Self-appointed agents and touts have allegedly been running a huge business by ‘arranging' delivery of these loans. Banks would be better advised to assess the utilisation of the loans already disbursed.

Ms Ramani P. Nair, President of District Panchayat, who delivered the keynote address, proposed block-level meetings to iron out complaints with regard to delivery and servicing of education loans.

PRIORITY SECTOR

The meeting was informed that banks in the district disbursed Rs 4,380 crore under the priority sector up to December 2010.

This represented 93 per cent of the total proposed for the financial year. The total bank deposits in the district stood at Rs 28,891 crore and advances at Rs 20,287 crore, providing for a credit deposit ratio of 70 per cent.

An amount of Rs 2,244 crore was disbursed as loan in the agriculture sector and Rs 1,968 crore in the services sector. In the non farm sector, the banks disbursed Rs 331 crore, amounting to no more than 51 per cent of the target.

SAVINGS ACCOUNTS

Nearly two lakh new savings bank accounts were opened in the district for crediting the wages of workers under the rural employment guarantee scheme. The annual credit plan for banks in the district has set a target of Rs 5,393 crore in the priority sector for the financial year 2011-12.

Published on May 10, 2011
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