THIRUVANANTHAPURAM: Over 70,000 candidates have applied for the state government’s education loan repayment support scheme, with the window having closed on January 31. The applications are being processed and funds will be sanctioned this fiscal itself.
About 94,000 candidates had registered for the scheme with the online portal. But the Finance Department said a considerable number of registrants did not submit applications, presumably after they found themselves ineligible for the scheme.
The amount to be borne by the government would become clear only after the applications are processed online, officers said. An application is first processed by the bank which sanctioned the loan and will be forwarded to the government through the State Level Bankers’ Committee. The government will pay its share to the banks directly.
Provisions in the scheme
There are two types of assistance for loans up to Rs 4 lakh which turned into Non Performing Assets (NPA) as on March 31, 2016, or before. The first involves 60 per cent payment of the loan by the government and 40 per cent by the candidate. Only up to 60 per cent of the basic loan amount will be paid by the government.
Second is a one-time settlement scheme for loans which remain NPAs as on March 1, 2016. Of this, 60 per cent of the basic loan amount will be given by the government and 40 per cent by the borrower. The bank should write off the interest.
Another provision is for loans between Rs 4 lakh and Rs 9 lakh, which became NPAs on or after March 1, 2016. Fifty per cent of the loan amount will be paid by the government subject to an upper ceiling of Rs 2.40 lakh.
Another scheme is for loans for which repayment was defaulted before March 1, 2016. The annual repayment amount, including basic amount and interest, will be shared by the government and the borrower.
The basic loan amount will be fully repaid by the government in case of candidates who became permanently disabled or died if the bank writes off the interest and the penal interest.