Education Banks will soon be set up in the country to help students who are willing to pursue their studies but find it tough due to economic constraints.
The Education Bank will help financial institutions willing to grant loans to students at an interest rate of four per cent. At present, the interest rate on education loan hovers between 11 to 14 per cent.
The bank will ensure that students from economically weaker sections benefit from the lower interest rate, rather than students from an affluent background.
With the government chipping in with funds, the education loans are expected to improve the gross enrolment ratio in higher education, which is about 11 per cent for all and 4-5 per cent for SCs and STs.