| Education
is a primary ingredient for the development of any country.
It is central to the Human Resource Development. Government
is taking heed that this basic necessity, to build a healthy
society is taken care of with the help of various government
aided institutions. Though primary education is a must in
today’s world, a survey of the present education system
will prove that higher education is gradually moving into
the domains of the private sector. As an obvious result, students
with promising capabilities are falling short of pursuing
higher studies owing to the increasing expenses. Thus the
need for institutions to provide funds for pursuing higher
studies and thus the term "loans
student".
In the past, a story of a poor chap unable to pursue his career
due to lack of funds was very common. Now Government, along
with various private sectors have taken steps that none such
deserving student is denied an opportunity to pursue higher
education. The scope of education has widened not only in
India but also abroad and along with it, has popped up various
institutions, commercial banks to provide loans to such students.
Students’ loans or loans for education should be considered
to be an investment for the development of national prosperity
and national economy, as students form the pillars of a strong,
economically sound, literate and healthy society of tomorrow.
The loans granted are meant for poor students so that they
can undertake basic education and for those meritorious students,
who want to pursue higher or technical or professional education.
Education loans are of two types. Loans
Student in India and loans for studying abroad. For studies
in India the maximum amount of loan which can be sanctioned
is Rs7.5 lacs and for studies abroad the maximum amount is
Rs15 lacs. Initially what seemed to be a dream is now at the
fingertips of the students. All they need to do is to apply
for a loan and it should be noted that any application for
loan can not be rejected without the concurrence of the next
higher authority. Just the two-word "loans student"
has opened new vistas for students who dream to have a career
abroad or as stated even in their own country
Now the question is, what should be the student eligibility
to get the loan sanctioned? The student should be a citizen
of the country and the admission so acquired in the particular
course should be a secured one by the virtue of an Entrance
examination. The student should also secure the minimum percentage
in the Entrance examination as stated by the particular bank
or institution granting the loan. Now, whenever the term loan
comes to mind, the immediate term to follow is security. Government
and the other private sectors who grant such education loans
have made the whole process of student’s loan customer
friendly. Different institutions have different systems pertaining
to their policy discretion. For instance, there is no need
of any security up to Rs2 lacs but exceeding Rs2 lacs will
have to be supported by a collateral security of cent percent
of the loan amount. The security may be in form of land, government
securities or any policy or bank deposits in the name of student
or parent and so on. Another term associated with loan is
margin. What is this margin? Margin is the difference between
market value of loan collateral and face value of Loans
Student. For instance, according to a general outline
lay out for the assistance of the commercial banks margin
up to Rs2 lacs is nil. If it’s above Rs2 lacs, studies
in India 15%, studies abroad 25%.
The rate of interest is also dependent on the policy so granted
by various banks. For Rs2 lacs the rate of interest will be
only PLR (Prime Lending Rate) but above Rs2 lacs it will be
PLR plus 1%. The rate of interest is to be debited on quarterly
or half yearly basis during the Repayment holiday or Moratorium
period. Now what is this Moratorium or Repayment holiday?
The Course period plus one-year or six months after getting
job is known as the Repayment or Moratorium period. There’s
one thing that should be taken care of, a penal interest 2%
will be charged above Rs2 lacs for the overdue amount and
overdue period. Now what does the student do if he is unable
to complete the course within the scheduled time? An extension
period of two years may be granted if the student is unable
to complete the course.If by any chance, the student is unable
to complete the course cause of certain reasons that lies
beyond his control then, an extension may be granted by the
sanctioning authority at their discretion. The banks maintain
a contact with the college or university authority to obtain
a progress report at regular intervals to keep a track of
performance of the student who have availed Loans
Student. Sometimes the foreign university may ask from
the student a capability certificate duly issued by the bank
to ensure that the sponsor of the student is capable of meeting
the course expenses till its completion. In such cases, the
respective bank issues a capability certificate. Apart from
it the bank itself may ask for a declaration or an affidavit
stating that no other loans are availed from any other banks.
Expenses that fall within the domain of the loan sanctioned
includes course fee, examination/library/laboratory fee, purchase
of books and equipments expenses, travel expenses, passage
money for studies abroad and all the other necessary expenses
to complete the course like study tours, project work and
so on. Last but not the least the loan applications have to
be disposed within fifteen days to one month.
"Loans Student" is
a very common term today. Though a very short term, still
it can be a key to ones dream world where wishes are fulfilled
and dreams become a reality. By the virtue of loans nothing
is impossible now. Students can aspire to dream of a career
abroad, can dream of pursuing higher studies, even though
money problem try to haunt them and obstruct them from moving
ahead. The terms and conditions are made flexible taking into
account the customer friendliness of each institution. All
that a student needs to do to achieve his dream in today’s
world is to become a "loans
student" from a student.
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