Factors Skulking Educational Loanees In Reaping Loan Utility: Evidences From Kerala

Abstract

The educational loan landscape in Kerala reflects a complex interplay between rising disbursement statistics, increasing Non-Performing Assets (NPAs), and the imperative of leveraging human resources for economic growth. Despite the potential for remittances and demographic advantages, challenges persist in realizing the full utility of educational loans. This study delves into the problems and prospects faced by loan recipients in commercial banks of Kerala, examining factors such as loan processing time, coverage, lending bank sector, and collateral requirements. Policy discussions center on balancing commercial interests with social responsibility, with calls for revising loan terms and enhancing borrower utility. While policymakers advocate for leniency, banks emphasize stringent monitoring amid rising bad loans and recovery costs. The study aims to reconcile these divergent interests and address socio-economic challenges in higher education financing. By analyzing the association between loan variables, default rates, household dynamics, and alternative finance sources, the study affirms that loan-related factors significantly impact borrower utility. Utilizing basic statistical tools, the paper provides insights into the complexities of educational loan administration and proposes avenues for policy reform to optimize the efficacy of student loan schemes.