Kerala Government will bear interest on educational loans taken by the BPL category students during the time of study from 2004-2009. Briefing on Cabinet decisions here, Chief Minister Oommen Chandy said the Centre was now providing waiver to students who had taken loans after 2009. Instruction had been given to the lead banks not to levy penal interest. Simple interest and base interest of the loans during the study period would be given by the State Government. A committee consisting of representatives of lead banks and Secretaries of higher Education, Finance, Local Self Government (LSG), and Cooperation would be formed to expedite the process. No recovery activities or any such processes should be initiated by the banks till a consensus has been reached.Instead of paying directly to the beneficiaries, the government would remit the required amount in the banks as and when final shape was given to the whole process.
The present stand taken by the banks was not providing educational loans for students who opt to go out of the state for studies was not acceptable. Government's clear stand was that loans were provided irrespective of the place opted for pursuing studies.

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