SBI scholar loans to help students buy mobile, laptop

Students of select institutes will not have to worry anymore about financing their education.

The State Bank of India (Lucknow) has come up with a scheme called "SBI Scholar Loans" for students of institutes like the Indian Institute of Management, Lucknow (IIML); Indian Institute of Technology, Kanpur (IITK); and IIT-BHU, in the Lucknow Circle.

Under the scheme, no security/collateral or guarantee needs to be given by students for the repayment of loan; the moratorium has been granted for the whole of the course duration plus six months, with a flexible repayment period of up to 7 years.

The students are required to pay nothing as the processing fee of the Scholar Loans while "simple interest" rates are applied during moratorium period.

"Moving a step ahead, certain education-related needs of students that were not covered in the Scholar Loans are also being taken care of. For example, purchase of laptop, mobiles, items of general needs etc," said Shiva Kumar, chief general manager, SBI Lucknow.

To make convenient all financial requirements of new entrants, the bank has identified Behta Saboli, a branch in Lucknow, that would sanction and disburse the Scholar Loans on the spot.

To apprise students of the new scheme, SBI had sent mailers in the form of pre-sanctioned loan letters to all new entrants to IIM Lucknow (IIML) scheduled to join the institute on July 1, 2006.

To make IIML students feel at home, SBI also made arrangements to welcome the students at the railway station and arrange transportation facility for them and their parents from the railway station and the airport to the IIM, situated 15 km away.

For this, the bank has set up counters at the railway station and IIML. Complete information about Scholar Loans is available to students over these counters. Students can also confirm their acceptance of the scheme at these counters.

Kumar told Business Standard that last year about Rs 19,00,0000 was sanctioned by the bank and distributed among 49 students of IIML. A total of 564 students from three elite institutes in Lucknow availed Rs 800,00,000 loan from the bank during the year 2005-06.

During the current year, the bank expects 800 students to avail the benefit of Rs 15,00,00,000 under the scheme. He said SBI is implementing the scheme to create a good image among the "global managers" of future.