Applications for Educational loans doubled in last 5 years

Indian Banks Association has published a data and as per which the number of applications for educational loans has doubled in last 5 years. Students are applying more for educational loans and this number has grown considerably. This data is compiled annually from records of all 28 nationalized banks in the country, which reveals that 3.25 lakh loan applications were received in 2009-10 against 1.48 lakh applications in 2004-05.

The reason behind this increased application for educational loans is that there is considerable increase in the number of students who want to pursue higher education and a relaxation of educational loan norms. Previously, it was strict to get an educational loan and was only provided to the meritorious students. But now the time has changed and even an average student is now eligible for it, said Nupur Mitra, executive director of Indian Overseas Bank, Chennai.

Indian Overseas Bank, alone in Tamil Nadu, in 2006 received around 11,000 applications, and sanctioned about 30,000 applications from April to June this year. The bank has shelled out 48,000 educational loans in 2010-11. Educational consultant Jayaprakash Gandhi said that, engineering fees is stable in Tamil Nadu but fees for management programmes have grown considerably.

Management students have to shell out more between 5-15 lakhs and some of them are not able to study without the loan. Other expenditures like tuition fees, allied expenditure on hostel facilities, travel and laptops has also risen over the last five years. Now educational loans are also available for teaching courses.

But as the world is changing so are parents as they want to make their children more responsible so they prefer to take loans even if they can afford.

 

Source: Richha Bhatnagar (Shiksha Team)