Education loan applications drop 30-50% in Tamil Nadu | Chennai News

CHENNAI: The Covid-19 pandemic, which is still raging, which has affected all sectors, has also affected educational loans. Banks say they have received between 30% and 50% fewer applications this year compared to last year and expect a 25% drop by the end of the financial year.
Delayed college admissions, remote learning, reduced parental expenses, and the deferred payment option offered by colleges are cited as possible reasons. The lack of physical movement between the states and the parents’ desire to keep their pupils close to them could also have played a role.
A senior official at the State Bank of India (circle of Tamil Nadu and Puducherry) said that around 2,300 applications worth 240 crore rupees were sanctioned in April-November in TN this year. “Around 4,000 education loan applications were sanctioned in 2019 ”.
Lenders also say there will be pent-up demand from students in the second or third year. “Some engineering Universities charge Rs 12 lakh-Rs 15 lakh for normal engineering courses, compared to other local universities which charge Rs 4 lakh-Rs 5 lakh. Students who did not apply this year could do so during the second year, ”he said.
Indian Bank, which sanctioned around 1,500 educational loans worth 114 million rupees between April and November 2019, approved 640 applications worth 57 million rupees in the same period this year.
M Aruna, deputy CEO of Indian Bank, said that many universities have yet to reopen. “There is always a rush from North India to pursue engineering courses in Tamil Nadu. That enthusiasm has waned … However, students are in the midst of joining medical schools after the adviceand you have to wait and watch until the end of January 2021, “he said.
S Kanimozhi, deputy CEO of Canara Bank, said medical advice was still available and the students had not yet come in person to verify the originals. “For students admitted to IIT, we have provided the option to make use of the branch on campus, under Vidya Turant loan scheme.”
S Vaidhyasubramaniam, vice chancellor of SASTRA considered university, said that many institutions started issuing bona fide certificates for educational loans only from December. “Students can apply for loans from banks only after obtaining good faith rate estimates and certificates. So we’ll have the full picture only in January, ”he said.
Institutes like SRM Institute of Science and Technology have allowed students to pay in installments. “Maybe later they will take a loan for education,” said Vice Chancellor Sandeep Sancheti.
P Selvaraj, secretary of the Consortium of Self-Funded Professional Universities, Arts and Sciences, said that students will earn bona fide certificates only when they arrive at universities. “During the pandemic, banks are not enthusiastic about disbursing education loans.”
The coordinator of the Task Force on Education Loans, K Srinivasan, said they hardly received any complaints about education loans. “Usually the complaints spill over after the admission season. The hesitancy on the part of banks in processing loan applications from students admitted to non-accredited universities also reduced the number of applications. ”
(With input from A Ragu Raman)
Previous Fannie Mae Updates Guidance on Limiting Advance Service Obligations | Ballard Spahr LLP
Next Mastercard and ACI Offer Technology to Drive Real-Time Payment Adoption | Source Payments