Govt to resume interest-free student loan scheme

The government has decided to resume the interest-free loan scheme for students who passed the G.C.E. Advanced Level examination but could not secure admission to state universities.

The interest-free bank loan of up to Rs. 1.1 million, provided to students to pursue higher education, includes Rs. 800,000 for tertiary education courses and an additional Rs. 300,000 to cover their daily expenses, according to Finance State Minister Ranjith Siyambalapitiya.

As the interest rate for loans has increased to 25%, it was decided that the interest-free student loan scheme be recommenced, the state minister explained.

Under the directives of President Ranil Wickremesinghe, arrangements will be made to grant this loan scheme to 5,000 students.

This loan scheme, which is only available at the Bank of Ceylon at present, will be granted through the People’s Bank and the National Savings Bank (NSB) as well, Siyambalapitiya said further.

The Z-score obtained at the Advanced Level examination and the availability of employment opportunities for the subjects selected by the students will be taken into consideration when granting the interest-free student loan scheme.

Loan repayment should begin following the completion of the course and a one-year grace period. The students should repay the loan during the tenure of their employment within a period of 12 years.