Govt working on guarantee scheme for educational loans: RBI

In a bid to remove problems faced by students in obtaining education loans, government was working on a scheme under which it would extend guarantee for advances upto Rs 7.5 lakhs, Reserve Bank of India governor D.Subba Rao said on Wednesday.

"There are grievances of students not getting loans or encountering problems...Understanding that there is a problem, the government is now working on a guarantee scheme," he told students here at an interactive programme organised by RBI and ABP News.

He said for loans upto Rs 7.5 lakhs where there was no third party guarantee or collateral security there would be guarantee given by the government.

"It is yet to be launched. Hopefully it would come and resolve some of these issues," he said replying to a question on the woes of students in getting educational loans.

On paper for loans upto Rs 4 lakhs there should be no collateral security or guarantee. "For good students and good institutions it is easier to get loans than for students not so good or institutions not rated so high," he said.

"But our endeavour is irrespective of level of achievements of institutions, they must have access to education loan upto Rs 4 lakhs," he said.

On inflation, he said "our endeavour, effort and expectation is that inflation will come down and will remain steady" so that it accelerate growth.

He also said RBI wanted to deepen penetration of banks either through bank branches or Business Correspondents since more than 50 per cent of the households in the country did not have bank accounts.

Noting that RBI and the government had initiated several steps towards financial inclusion with a view to ensuring that every household had bank accounts, he said it would become successful only when banks see it as a business opportunity.

Replying to another student, the RBI governor said the apex bank was playing a development role and had implemented steps for rural development including priority sector lending.

On security and safety of electronic transactions, he said "Securing security is shared responsibility. It is not the exclusive concern of RBI alone. It is responsibility of commercial banks and of the customers."

All the three should share the responsibility and work together to ensure that banking transactions especially electronic and mobile transactions were safe, he added.

Students surrender seats over high fees

The dreams of four students were shattered on Monday when they surrendered their seats after CET counselling because they couldn't pay the fees. Interestingly , the government is receiving reports of private professional colleges harassing students for additional money to join the course.
Even though the state government has decided the quantum of fees colleges can charge, most institutions are charging extra for offering "other facilities" . Around 10 students surrendered their seats on Monday . Of these, four mentioned financial burden as the reason. A student, who got admission to Dayanand Sagar College, decided to go ahead with his BSc course instead of BE.

Complaints flood KEA
Financial burden is taking a heavy toll on students ' dream. Quoting high fees, four students decided to surrender their seats post-CET counseling.
"The Karnataka Examination Authority may be able to settle the issue this year. But next year, the college will ask us for more fees," said a helpless father who preferred anonymity . The student was asked to pay a fee over and above what was paid at the KEA helpline centre during counselling.

Another student, who was asked for Rs 37,000 by Bangalore Institute of Dental Sciences , surrendered the seat for the same reason, after having already paid Rs 35,000 after document verification. Financially strapped students who got admission to Alpha College of Engineering, Bangalore and C Byregowda Institute of Technology, Kolar also gave up their seats. These students typically would have paid up to Rs 41,590 after counselling.

KEA has been flooded with complaints on colleges demanding extra fees. On Monday, the government met private colleges ' association. Officials at the meeting told TOI that private colleges have agreed not to charge extra fees and not to send back students. They won't charge fees for supernumery quota. The department has assured students can contact KEA with complaints.