If you are facing difficulties in getting an education loan, you can bank on finance minister P Chidambaram to help. Keen to enable students realise their dreams, the government has allowed them to directly contact the finance minister or finance ministry officials if a public sector bank denies an education loan without genuine reasons.

Public sector banks have been directed to ensure that criteria like location of residence or age do not come in the way of a student availing education loans. "We have directed banks not to create objections in issuing loans as long as the area of residence of the student and the bank branch are in the same district," a senior official in the finance ministry said. In other words, a PSU bank branch cannot reject an education loan application on the grounds that the residence of the student, the education institution or the guarantor is not in the same locality.

In many cases, the residence of an education loan applicant is not in the same place as the guarantor. "Banks usually insist that the guarantor and the candidate should be residing under the area of a single branch, which is impractical. We have issued a directive to all banks with an aim to remove this ambiguity," the official said.

Many students had written to the finance minister seeking his intervention and all the genuine cases have been resolved, he added. Now, an officer of joint secretary rank has been designated to address all education loan-related grievances addressed to the finance minister or the ministry. PSU banks have also been told that age should not be cited as a criteria for rejecting education loans. This means that even a 35 or 45-yearold can avail an education loan.

Banks can thus no longer insist that the place of residence of a student and the college should fall under the `branch area' concerned for availing a loan. The branch area of a bank is usually between a radius of six and eight kilometre.

Only for courses approved by govt
HOWEVER, there are no set rules for this distance and it varies from bank to bank and location to location. In contrast, district area in most cases has a radius of 30-40 kilometres.
Genuine reasons for denial of loan include past track record of the candidate. The pro-student rules do not apply for courses not recognised by any statutory body like UGC, AICTE, the central government or a state government.