Due to the fall in the value of Indian currency, the fees in higher educational colleges are becoming costlier day by day. The Indian government has started many educational loan schemes so that the poor and middle class meritorious students can pursue education in reputed institutions. The government funding for educational loans in India is very much necessary to develop the prosperity and growth of the economy. Some of schemes that are initiated by the government to encourage education are discussed below.
- Scheme initiated by NHFDC-
The National Handicapped Finance and Development Corporation provides loans to disabled persons of India to pursue higher education in India or abroad. The person applying for this loan must be an Indian citizen with 40% or more disability.
The National Scheduled Tribes Finance and Development Corporation also provides loan at a nominal rate 3% to the eligible Schedule Tribes candidates to pursue higher education in India. The student applying for a loan under this scheme must be from a Schedule Tribe community and his annual family income should not be more than Rs.81000 (for rural areas) and Rs.1, 04,000 (for urban areas). He must also be eligible to get admission in college or a university recognized by Indian government.
The National Scheduled Castes Finance and Development Corporation also funds loans to encourage education among the students of Schedule Caste. They provide loans for pursuing education in the field of Engineering, Management, Pure Sciences, Agricultural Science; and Medicine.
The National Education Finance Corporation provides education loan to eligible students of India to avail higher education. They provide loans with a longer repayment facility. For example families of the students having an annual income of less than Rs.4.5 lakhs are provided at a rate of 4% per annum.
"· Funding by IBA-
The government of India has framed a Comprehensive Educational Loan Scheme by consulting with the Reserve Bank of India and the Indian Banker's Association (IBA) to provide loans to the eligible students of India. The courses offered under this scheme ranges from graduate courses, professional graduation courses to technical courses. The scheme also provides loan for vocational courses offered by ITIs, polytechnic colleges and Industrial training centers. The amount of loan given is upto Rs.7 lakhs for studying in India and Rs.15 lakhs for studying abroad. The credit-guarantee fund system initiated by the government of India has helped the banks to willingly provide loan to deserving candidates.
"· Educational Loan by NMDFC-
The National Minorities Development and Finance Corporation grants loan for job oriented education to poor section of the people in India. A deserving candidate can get a loan amount of maximum Rs.2.5 lakhs for a period of 5 years.
The government of India provides loan for higher studies so that no meritorious student in India is deprived of getting an education. With the emphasis on educational loan by the government of India the economy of the country will also develop.