NIIT offers student loan scheme

NEW DELHI: Indian computer education firm NIIT Ltd., said on Thursday that it

had tied up with Citibank and International Finance Corp (IFC) for providing

loans to NIIT students.

NIIT, India's largest computer education firm with interests in software

development, said in a statement that Citibank with this venture would target

loans worth Rs 4 billion in five years. IFC, the private sector funding arm of

the World Bank, will be providing the loss coverage guarantee in case of payment

defaults.

"It (loan) will be offered to students of pursuing the i-GNIIT program

at NIIT. The loan program covers the cost involved towards tuition, a multimedia

personal computer and Internet connection," it said. NIIT's i-GNIIT course

specifically targets full-time undergraduate students enabling them to acquaint

with the latest developments in Information Technology.

The loan will be for a seven-year period and will cover 90 per cent of the

three-year course. During the study period, students are required to repay only

60 per cent of the interest, while the remaining interest and principal can be

repaid in the next four years, the statement added.

The scheme, which is being implemented for the first time in the country,

aims at making computer education commercially viable without the help of

government subsidies. Higher education in India's government-run colleges is

heavily subsidized and commercial banks typically offer student loans only for

select institutions and overseas education.

"In the past, financial institutions have been weary of investing in

educating a student as it was often viewed as the primary responsibility of the

state. This apart, it was perceived as a loss-making proposition," the

statement quoted Citibank's advisory board chairman Gurcharan Das, as saying.