Trivandrum: As an initiative to address the Education Loan Borrowers who are in distress due to factors beyond their control, the State Bank of Travancore has introduced a new One Time Settlement (OTS) scheme called SBT Karunya.
According to a press note from SBT, on analyzing the reasons for failure to repay the education loans, we have come across several cases where a genuine humanitarian approach has to be applied on a case to case basis. Hence, a fairly liberal approach considering the various facts that have resulted in non-repayment of the loans has been put in place and based on objective criteria, a scheme has been formulated to be available for a limited period on non-discretionary and non-discriminatory basis. The settlement shall be made effective on case to case basis taking into consideration the nature of problems of the borrower. This will in a great way be a relief for the underprivileged / unemployed students and their parents who are in distress. The scheme covers education loans for courses in India up to Rs.4 lakhs.
If the borrower (student) has expired, concession is given up to 100% of the principal and interest. In this case, without remitting any money the account will be written off and the family will be relieved of the entire dues to the Bank.
If at least any two of the following conditions apply: the student is incapacitated by terminal illness / invalid; if the earning parent is deceased and the family do not have any landed property; where the earning parent is incapacitated by terminal illness / invalid and the family do not have any other valuable assets; if student has not procured any job three years after the successful completion of course, concession will be granted up to 90% in principal and 100% in interest.
This scheme is open from December 01, 2015 to January 30, 2016. The existing compromise settlements for all education loans facing other issues shall continue simultaneously. In such cases, write off of even up to 50% of interest amount could be considered on case to case basis.
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