Banks told to give reasons for rejecting education loans

Banks have been asked to assign reasons for rejecting any educational loan applications, Parliament was informed today.

“Banks have been advised that rejection of education loan applications has to be with the approval of the controlling authority of the branch concerned and the reason for rejection should be communicated to the applicants in writing,” Finance Minister P Chidambaram told the Rajya Sabha in a written reply.

“Indian Banks' Association has advised banks to give wide publicity to their grievance redressal mechanism on education loans and to make effective use of the mechanism," he said.