Kerala state government has launched the “Education Loan Repayment Scheme” with an aim to reduce the financial burden on families belonging to lower income group. The Rs. 900 crore scheme would benefit the students who have availed loans of upto Rs. 9 Lakh and whose annual household income is not more than Rs. 6 Lakh.
The scheme aims to extend help to those financially weaker students who didn’t get a job after their studies and unable to repay their education loan. The state government may extend the scheme by by infusing more funds in future. The current budget was set for the scheme on the basis of preliminary collected data. The government would conduct a detailed survey later to help all those students who are in real need of this scheme.
Highlights of Kerala Education Loan Repayment Scheme
- The scheme will apply to loans whose repayment began before April 1, 2016.
- The government will bear 90 percent of the amount repayable during the first year and 75 percent in the second year.
- 50 percent of the repayable amount in the third year and 25 percent in the fourth year would be borne by govt.
- For loans up to Rs 4 lakh which were deemed non-performing assets before March 31, 2016, the government will bear 60 per cent of the principal amount. The remaining 40 per cent has to be borne by the loanee.
- For loans between Rs 4 lakh and Rs 9 lakh that have turned NPAs, the state government will shoulder 50 percent of the principal amount, subject to a maximum of Rs 2.4 lakh.
Kerala ELRS Guidelines
The detailed guidelines of Kerala education loan repayment scheme can be downloaded from the official website at elrs.kerala.gov.in using the below link.
Operational Guidelines of Scheme
The education loan repayment scheme of Kerala Government would benefit those with total household income of not more than Rs. 6 Lakh per annum and have availed no more than Rs. 9 Lakh in education loan. Under the scheme, 60% of the loan repayment amount would be borne by the state government while rest 40% would have to be borne by the student itself.
The banks would have to waive interest on the loan and penal interest to avail repayment from the bank.