Thiruvananthapuram: Kerala Chief Minister Oommen Chandy on Wednesday said the state government will act tough on commercial banks that do not provide educational loans to students. "It has come to our notice that banks charge different rates and we make it clear that they will not sit idle, if things do not change," Chandy told reporters here after a weekly cabinet meeting.
He said the only condition for all educational loans up to Rs 4 lakh was that there need be no guarantor or even collateral. "The only condition to these banks was that they need to verify if the educational institution that runs the courses was a government approved one," he said.
Chandy also said the state government had decided to provide subsidy by way of paying the interest of all educational loans given from 2003 to 2009. "The interest would be borne by the state till the student completes one year after his course or six months after he gets employed, whichever is earlier. The Centre now provides interest subsidy to all the educational loans availed after 2009," added Chandy.
The chief minister said he had taken up the issue with Finance Minister Pranab Mukherjee and also called a meeting with the banks to discuss the issue.