JOIN USAccording to the Karnataka Examinations Authority (KEA), as many as 14 banks, public and private, have come forward to approve spot loans for students opting for government quota seats.
The loans will be sanctioned at the preliminary level within minutes of the student receiving a seat under the government quota to any engineering or medical stream. The spot loans will be sanctioned for a maximum of Rs one lakh per annum.
“The CET ranking and admission ticket will be a guarantee for banks that wish to provide loan to the student,” informed KEA officials.
As per the current understanding between the banks and the Government, the loans will be disbursed to students at six per cent interest.
“While the actual bank rate for education loans is 14 per cent, the Government will be bearing the burden of eight per cent for the students opting for seats under Government quota,” informed the official.
The KEA is also issuing a Government order to all the 14 banks to open their counters to issue spot loans at the other four counselling centres including Gulbarga, Shimoga, Mangalore and Hubli.
Banks that have come forth to provide the facility include HDFC, SBI, SBM, Indian Bank, Corporation Bank and Central Bank of India. “Private banks have even offered to approve loans up to Rs four lakh,” informed the official.
However, Indian Bank officials, the official banker for the KEA, said the loans will be disbursed “subject to conditions”.
“As per the rule, education loans up to Rs four lakh will not require any surety. But beyond Rs four lakh, there will be conditions of collateral,” informed an official from the Indian Bank.
While the loans will be approved on the spot based on the student’s CET ranking, his admission card and the college he or she has opted for, the actual realisation of the amount will be done after the regular process is carried out to disburse the amount.
“The loans will be disbursed by demand drafts made out directly to the colleges and will take at least 10 to 15 days,” informed the bank official.