Education loan disbursal in UP exceeds Rs 3,300 cr

The total disbursal of education loan in Uttar Pradesh by commercial banks, regional rural banks (RRB) and cooperative banks has been in excess of Rs 3,300 crore.

While, majority of disbursal has been made by public sector lead banks, non-lead commercial banks and private banks have also contributed to this cause.

Lead banks are public sector banks, which have been mandated with ushering in financial inclusion in a particular district, whereby every village with a population of more than 2,000 should be provided with banking facilities by March 2012.

There are nine lead banks in Uttar Pradesh — Allahabad Bank, Bank of Baroda, Canara Bank, Central Bank of India, Punjab National Bank, State Bank of India, Syndicate Bank and Union Bank of India. Collectively, these banks had extended education loans worth Rs 2,300 crore since the inception of the education loan scheme benefiting almost 100,000 students.

Non-lead public sector banks had provided about Rs 850 crore education loans to 30,000 odd students.

Meanwhile, 11 private sector banks operating in the state had a miniscule share of providing about Rs 10 crore education loan to roughly 400 students.

The 10 RRBs operating in the state have so far provided about Rs 125 crore education loan to about 8,000 students.

This scheme, which was announced in Union Budget 2001-02, aimed at facilitating poor, but meritorious students to pursue higher education, through a scheme of education loan to be introduced by all banks. Its purpose was to provide financial support from banking system to meritorious students for pursuing higher education in India and abroad.

Further, to absolve poor students belonging to economically weaker sections from the interest burden on their loans, the union ministry of human resource development has declared a scheme to provide interest subsidy.

The current branch network of all banks in Uttar Pradesh is about 12,350, of which a majority at over 6,450 are in rural areas, followed by branches in semi-urban, urban and big cities.