Defaulting on the education loan can cost you heavily
By Neelima Shankar
Jul 30, 2014
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It has been reported that banks are working their best to reduce the NPAs. In the field of education loan the banks are facing great number of NPAs, so in order to curb them the banks looking for various options to recover their money.

According to the reports in the industry, public sector banks’ exposure to the segment has crossed ₹60,000 crore. The banks also stated that the credit losses are very high in the education loans and these are becoming unmanageable for the banks. The people with the poor credit history will not get the loan from any financial institution.

Earlier the govt. has restricted the banks from sending defaulters’ names to credit information agencies. But since the wrongdoings are increasing the banks have asked the IBA to take it up with the Finance Ministry to facilitate reporting to companies such as CIBIL. Banks are worried regarding their education loan portfolio. To control this some banks are even organizing awareness camps that will guide the people on the necessity for repaying the loans once they get employed.

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