Recently, the State Level Bankers Committee meeting held at Nabanna, West Bengal, confirmed the disbursal of loans applied through 80,000 student credit cards by 15th January 2023. Moreover, the Committee reported that 21,000 such applications were rejected earlier and they are confident about disbursing those pending amounts by December 2022.
If you are currently pursuing higher studies you can apply for a student credit card to fund tuition fees, buy all the necessary study materials, and bear other daily costs. To know more about student credit cards, continue reading.
How Will Banking Issues Related to the Acceptance of Student Credit Cards be Resolved?
In the most recent meeting of the SLBC held at Nabanna on 23rd December 2022, the authorities announced that 37,782 student credit cards have been sanctioned with a cumulative loan amount of Rs. 1,105 Crores. Additionally, the officials of the Finance Department, W.B., confirmed that by 15th January loan requests against 80,000 student credit cards will be processed duly.
Bankers can now easily approve the loans as the state government announced itself to be the guarantor.
Who Can Apply for a Student Credit Card?
The scheme will prove to be helpful for many students who want to continue their studies both within India and abroad. Besides university education, you can apply for these loan facilities even to fund your secondary or higher secondary studies. Moreover, if you are willing to study in a madrasah, you may apply for this SCC scheme.
Also, coaching institutions charge hefty fees these days that require upfront credit facilities. Thus if you intend to prepare for competitive examinations like IPS, IAS, JEE, Medical, Law, WBCS, etc., you can opt for this financing instrument. The interest levied on the loan amount is only 4% per annum. Also, an individual is eligible for a Rs. 10 Lakhs loan amount to fund their various educational requirements which may include buying study materials, travelling abroad, providing hostel fees, etc.
What Conditions You Must Fulfil to Get a Loan Against Student Credit Card?
Banks do not set standard credit card eligibility criteria for student credit cards as the applicants here are students and not regular working professionals. Therefore instead of conventional guidelines you need to fulfil the following demands to assure getting a loan against credit card.
- Apply Against a Bank FD
This is the most convenient method of applying for the SCC scheme. You need to present your FD as collateral though the amount deposited in that account must cross a certain threshold. This minimum account balance is different for all financial organisations and to know the exact figure you must contact the banking officials.
- Apply Against an Existing Loan or Savings Bank Account
Consider this to be the second-best method if you do not meet the FD criteria of your preferred banking partner. To ensure your savings bank account meets the eligibility benchmark you must maintain a stable monthly balance. Some banks even offer you an add-on credit card to their clientele who possess a student credit card showing a savings account as the collateral.
- Meet Criteria Set for Government Schemes
The Government of West Bengal has launched its own method of providing financial aid to students. Similarly, Jharkhand and Bihar governments also have their customised programs. You can check whether you meet the eligibility criteria and simply apply for the schemes.
- Apply as an Add-on Card
It can be a great option for easy approval of student loans if anyone among your family members already owns a credit card. But here the main condition is the primary cardholder must have a good credit history otherwise your application can get rejected.
What are the Benefits of Having a Student Credit Card?
There are several less-talked-about benefits which you should know before applying for a student credit card. These include:
- The credit limit is intentionally kept low so that students do not commit to too many impulse purchases.
- Similarly, the cash withdrawal limit is also significantly low to ensure the funds are only utilised in case of emergencies.
- Interest rates are low to reduce the repayment burden.
- Once a student credit card is issued, the validity expires within 5 years. It ensures you spend the loan amount only to fund expenses within the course duration.
- Many banks allow you to convert a student credit card into a standard credit card after you achieve employment status. It provides you an opportunity to maintain an excellent credit report provided you have been furnishing timely repayments. You can utilise this track record to easily upgrade to a more premium credit card.
- Student credit cards come with zero annual charges.
As you can see banks provide numerous advantages to a student who is financially struggling to continue his/her studies. To avail a student credit card, you only need to maintain a few credentials and may proceed with the application process online. Both the banks as well as selective state governments offer these loans at very low-interest rates. Hence, it becomes easy for everyone to pursue their ambitions without worrying about financing sources.
