Education loan must be remodeled to suite the nations demand. Right now the National Pension & Provident Fund is providing Education Loan based on stringent norms and is totally targeted towards facilitation of income base thereby resulting in sharing bonus out of PF member’s fund for the operational staff only.
Actually by now the management should have considered the idea ‘Perkin’s Education Loan’ practice by the US which has very much worked out for the needy citizens at large.Perkins loan is awarded to the undergraduate & graduate student with exceptional financial needs.
It’s a highly subsidized loan with low interest being paid by the government/ PF department for low income citizens on merit basis. There should be a grace period for about a year or so depending upon the readiness of the client in terms of the commencement of repayment. It’s high time by now that relevant Institute should work out some provisions at large for true sons of the nation.
The Central Bank must advise the FIs to create rooms for such provisional facilities like other developed nations.The loans are to finance the education and related schooling expenses and is supposed to be without collaterals. However, the NPPF is collateral›s oriented, be it based on parent’s accumulated PF or buildings or land without which such Education loan provisions are not entertained so where is the GNH practice in the country even after broadcasting it to the outside world that Bhutan is the land where GNH is practiced.
The student loan is usually the best choice education loan for a student whose parents cannot pay for his or her education. While the student remains in school, interest on this type of loan accrues and is paid for by the government. When the student stops attending school, the loan is usually paid off in payments. These payments can be quite large if the loan is large, so students should borrow only what they need. For that FIs must set methodologies depending on their job portfolio.
Opinion by Tshering Thimphu