According to data released by Indian Banks' Association, although banks have disbursed more number of education loans in FY11-12, but the total amount of loans sanctioned has declined substantially. In fiscal year 2011-12, 8.6 lakh students were provided education loans as compared to 8.1 lakh in the FY 10-11. In contrast to this, FY 2010-11, the total amount of student loans was Rs. 11,200.56 crore, which decreased to Rs. 8103.06 crore in the next fiscal.
The data has been collected from 26 public sector banks and 24 private sector banks.
One of the reasons for this could be the fact that more number of loans are disbursed under the vocational courses category. These loans are cheaper and are repaid quickly as these courses are shorter.
The data released by IBA, shows that although student loans of less than Rs. 4 lakh increased, the total amount sanctioned under the category declined by Rs. 3172 crore.