Bihar CM Nitish Kumar Unveils Interest-Free Education Loans for Class 12 Graduates

quick Summary:

• Bihar Chief Minister Nitish Kumar announced interest-free loans under the Student Credit Card Scheme for students who passed Class 12 board examinations.
• Previously, education loans of up to ₹4 lakh were offered at varying interest rates: 4% for general male applicants and 1% for female, differently-abled, and transgender applicants. Now,loans are entirely interest-free for all applicants.
• The repayment period of loans has been extended:

– Loans up to ₹2 lakh can now be repaid in a maximum of 84 monthly installments (previously capped at 60 months).
– Loans above ₹2 lakh can now be repaid within a maximum of 120 monthly installments (previously capped at 84 months).

• the scheme has been in effect as October 2, 2016.
• Nitish Kumar emphasized on enabling students to pursue higher education with enthusiasm and dedication as part of his government’s objectives.

Indian Opinion analysis:

the Bihar government’s decision to make student loans entirely interest-free under the Student Credit Card Scheme demonstrates a notable commitment toward educational access and affordability.By easing the financial burden associated with pursuing higher education-especially through longer repayment terms-the state aims to encourage more students from diverse backgrounds to enroll in advanced studies.This move aligns with broader efforts towards enhancing skill development and fostering economic growth by building human capital.

Moreover, transitioning from varying interest rates to a worldwide zero-interest model could simplify loan applications while promoting equitable opportunities across genders and social categories such as differently-abled individuals. As this policy evolves,its impact on enrollment rates in colleges or universities within Bihar will serve as a critical indicator of its effectiveness-from strengthening individual career prospects to contributing positively toward societal progress.

Read more: The Hindu article