Delhi government to give education loan up to Rs.10 lakh

New Delhi, Sep 9  The Delhi government on Wednesday launched a flagship scheme that allows students to avail education loan of up to Rs.10 lakh.

Education Minster Manish Sisodia kick-started the scheme here by distributing cheques to its first 25 beneficiaries.

"The government is with the students whose parents don't have property as a guarantee to avail loan for their education," the minister said. "We will take their guarantee and give them a chance to study and not let finance become a hurdle in their education." 

Describing it as a "big step" in the field of education, Sisodia said many students fail to continue studies due to the non-availability of education loans.

Students, who have cleared class 12, would be eligible for the loan meant for higher studies.

According to the scheme, a collateral or third party would not be needed for the loan.

The students would get a one-year moratorium after completion of his or her degree or diploma course and can repay the loan through EMIs over 15 years.

Sisodia, who is also the deputy chief minister, said the success of the scheme depends on the commitment of students to repay the loan.

"We take the guarantee of those students who fail to get a job despite higher education. But this trust will break if students do not repay even after getting jobs," he added.

Education is the top most priority for the seven-month-old Aam Aadmi Party-led Delhi government, which earmarked a lion's share -- Rs.9,836 crore -- in its Rs.41,129 crore maiden budget.