Budget 14-15: Major Relief for Education Loan Borrowers, 9 Lakh Student Borrowers to Benefit
Ministry of Finance
17-February, 2014
Major Relief for Education Loan Borrowers, 9 Lakh Student Borrowers to Benefit
The Union Finance Minister Shri P. Chidambaram has announced a
Moratorium period for all education loans taken-up to 31.3.2009 and
outstanding on 31.12.2013. Government will take over the liability for
outstanding interest as on 31.12.2013, but the borrower would have to
pay interest for the period after 1.1.2014. Nearly 9 lakh students
borrowers will benefit to the tune of approximately Rs2,600 crore.
Presenting the Interim Budget in the LokSabha today, the Union
Finance Minister ShriChidambaram said that a sum of Rs 2,600 crore will
be provided in the current financial year itself and this amount will be
transferred to the Canara Bank. Mr. P. Chidambaram said that the
Central scheme for interest subsidy was introduced in 2009-10 in respect
of education loans disbursed after 1.4.2009. However, students who had
borrowed before 31.3.2009 struggled to pay interest during the period of
study and they deserved some relief.
Shri P. Chidambaram informed that ten years ago, only a few thousand
students- mostly the well-connected- got education loans. At the end of
December 2013, Public Sector Banks had 25,70,254 student loan accounts
and the amount outstanding was Rs. 57,700 crore.
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