With the new academic session to begin,students claim a central government education loan subsidy is being kept under the wraps by most banks. Banks claim they have started processing claims for 2009-10,when the scheme became effective and students allege they are not being told about it when they approach banks. When asked about the issue,a senior official of Canara Bank,the nodal agency for processing subsidy claims,said it is yet to receive any directive for the current fiscal. We do not know if the scheme will continue this year or not,so customers are not being told about it, he said. According to the scheme,if a student applying for an education loan hails from a family that has an annual income of less than Rs 4.5 lakh,the student will be required to repay only the principal,and the interest will be borne by the central government. Students have to procure an income certificate from the local authority concerned declared by the state government to claim subsidy. Hemant Kumar,a student hoping to pursue a biotechnology course,said,We approached about six nationalised banks and a few co-operative banks. But we have not been told about any subsidies. If I get a loan under this scheme,it will be like getting a loan at zero per cent interest. But so far I was not aware of any such scheme. I had heard about it but when I asked banks,they said they are not sure if it will continue this year. With academic sessions to begin soon,if banks dont declare anything I may not be able to take admission to a college, Sharad Kelkar,another student,said. Banks claim they have informed existing customers about the subsidy for all loans sanctioned in 2009-10. As per Bank of Maharashtra (BoM) data,of the total sanctioned of education loans in Maharashtra,70 per cent are eligible for the subsidy and 60 per cent applied. All banks dealing in retail credit are required to communicate to students about the scheme and about income certificates. They are sending letters and mails to existing customers of the subsidy, said a Canara Bank official. VK Gupta,general manager,credit priority,BoM,said,Education loans constitute over 10 per cent of our total retail sector lending. Now were processing claims for 2009-10. Even courses that started before 2009,and were on in 2009-10,come under this scheme.
