Centre reimbursing education loan interest for SC,ST students

The BJP-led central government has asked banks to submit their claims for interest subsidy on education loans availed by students belonging to scheduled caste (SC) and scheduled tribe (ST) communities, a circular from the Indian Banks' Association (IBA) states.

According to the Nov 5 circular, banks can submit their claims for the period April 1, 2009, till financial year 2013-14 to the nodal agency Canara Bank in respect of eligible SC and ST students by Dec 31, 2014.

Under the interest subsidy scheme, the central government would reimburse the banks the interest due on the loan amount till the end of one year from the date of completion of the course, or six months from the date on which the student lands a job after his course, whichever is earlier.

"The Centre would reimburse the interest to those students whose parental income is less than Rs.450,000 per annum, and on loans which are available only for professional and technical courses and not for arts/science, and students of diploma courses," K. Srinivasan, convenor of Education Loan Task Force (ELTF) and a former banker told IANS.

The ELTF guides students on rules and regulations governing education loans offered by nationalised banks.

According to Srinivasan, students belonging to SC, ST community can approach the bank managers where they have availed their education loan and submit necessary papers for claiming the interest subsidy.

However the central government has made it clear to IBA that funds are not available for catering to claims of general category students for the year 2013-14.