Education Loan Interest Subsidy Scheme: Eligibility, Total Beneficiaries, Impact till now

Education Loan Central Sector Interest Subsidy Scheme: A consistent drop has been registered in the number of students availing the central government’s Interest subsidy scheme on their education loans in the last three years, as per the information provided by the government in the Parliament. The total number of beneficiaries pan India in the year 2017-18 was about 1.32 lakh which dropped to about 88,000 in the year 2018-19 and it further dropped to 75,417 in the year 2019-20. Under the Interest Subsidy scheme launched by the Modi government in its first term, students from economically poor sections of the society can avail loans from the scheduled banks in the country and claim interest on the loan as subsidy from the government.

In a written reply to the question raised by Member of Parliament Chandeshwar Prasad, the Union Education Minister Ramesh Pokhriyal put the information before the Parliament on Monday. Prasad in his question had asked the government about the salient objectives of the scheme, the total number of students who have benefited from the scheme in the last 3 years and the component of students from Bihar who had availed the benefits of the scheme.

What is Interest Subsidy Scheme?

Students from the economically backward sections can claim interest on their educational loans from the government as subsidy. The scheduled banks in the country provide the loans to students without the need of any collateral security against the loan.

Eligibility

The maximum loan amount which can be availed from the students under the scheme is up to Rs 7.5 lakh. It is also pertinent to note that the students can take benefit of the scheme only once in their life- either in their graduation course or their post-graduation or combined course. Only those students who are enrolled in technical and professional courses and whose parents’ income is less than Rs 4.5 lac per annum can benefit from the scheme.

Total number of beneficiaries

A total of 1,32,825 availed the benefits of the scheme in the year 2017-18 out of which a total of 1,01,72 students came from the state of Bihar alone. The number of beneficiaries subsequently dropped to a total of 88825 in the year 2018-19 out of which about 3500 students were from Bihar state. The number further dropped to 75,417 out of which the total number of students from the state of Bihar was 2106. The amount of loan sanctioned to different students in the last three years remains unclear as the Education Minister did not provide a break up of the loan amount availed by students in the last three years.