According to information compiled from all of the state-degree bankers’ committees (SLBCs), as of December-end (third quarter of this fiscal), Rs 8,263 crore belonging to extra than 3.5 lakh accounts which have availed schooling loans have been categorised as non-performing belongings (NPAs) out of the entire schooling loan excellent of Rs 84,965 crore that extra than 23.Three lakh accounts borrowed.
Stream-wise information exhibits that of the Rs 84,965 crore whole excellent quantity, loans to medical students is Rs 10,147 crore (11.9%), engineering students is Rs 33,316 crore (39.2%), nursing Rs 3,675 crore (4.3%), MBA Rs 9,541 crore (11.2%) and all different streams collectively Rs 28,286 crore (33.2%).
In NPAs towards the excellent loan quantity, nursing tops the listing with over 14%, adopted by 12.1% in engineering, 7.1% in MBA and 6.2% in medical. Other streams collectively have 8.4% of the excellent loans as NPAs.
Doraswamy C, former convener of Andhra Pradesh SLBC, says: “Education is a priority lending sector, and beneficiaries must be sincere in returning the money they borrowed. But that does not happen in many cases. From evasion to negligence, there are many reasons for this. Besides, delays in interest subsidies payment by the Centre and other systemic problems also hurt honest re-payers.”
Education professional AS Seetharamu says: “The time needed to find employment for an engineering student is more than that for a medical professional. Nearly 30% of engineering students drop out annually and campus placements have been dipping. In cases of nurses, most leave the country and the banks don’t find them. Visas need to be linked to education loans. Domestically, they avail loans in one place but work in another.”
States’ Performance
Further, distribution of schooling NPAs throughout the nation exhibits that the japanese and southern areas, led by Bihar and Tamil Nadu, have emerged because the worst performers, whereas northern and western areas are the perfect.
Compared to the nationwide common of 9.7% of NPAs, it’s 14.2% in the japanese area and 11.9% in the southern area. It is simply 3.3% and three.9% in the northern and western areas, respectively, whereas it’s 6.1% and 6.8% in the central and northeastern areas.
Other Sectors
While all this information is for the primary three quarters of this fiscal, information from earlier years exhibits how the schooling sector is among the many prime contributors to NPAs after trade and agriculture.
At 21%, 16.7% and 13.6% in fiscals 2018, 2019 and 2020, respectively, the trade sector tops the desk, adopted by the agriculture sector — 7.8%, 8.9% and 10.3%. Comparatively, the figures for the schooling sector stand at 8.1%, 8.3% and seven.6% for the mentioned three years.
NPAs in the housing and vehicle sectors had been beneath 2% for all years, whereas it was 2.1%, 2% and 1.5% for the retail sector.