Bihar Government Rolls Out Interest-Free Education Loans For Class 12 Graduates

The Bihar government, under the leadership of Chief Minister Nitish Kumar, has announced a major reform in the Student Credit Card Scheme, offering interest-free education loans to students who have passed the Class 12 board examinations. This initiative aims to make higher education more accessible and reduce the financial burden on students and their families, especially those from economically weaker backgrounds.

According to the Hindu, previously, under the scheme, students could avail themselves of education loans of up to ₹4 lakh at an interest rate of 4% for general male applicants, and a concessional rate of 1% for female, differently-abled, and transgender students. With the new announcement, all eligible students will now be able to access loans without any interest, marking a significant shift in the state’s approach to promoting higher education.

Chief Minister Nitish Kumar emphasized, as cited by PTI, that the decision was taken to ensure that no student is denied the opportunity to pursue higher education due to financial constraints. He highlighted that the initiative is part of the state government’s broader commitment to improve educational standards, support youth development, and increase the gross enrollment ratio in colleges and universities.

In addition to waiving the interest on loans, the government has also extended the repayment period for loans up to ₹2 lakh. Previously, students were required to repay such loans in 60 monthly instalments, or five years. The new provision allows repayment in 84 monthly instalments, giving students up to seven years to complete the process. This change is expected to ease the repayment burden and provide more financial flexibility for graduates entering the workforce.

The decision has been widely welcomed across the state, particularly by students and education advocates who see it as a long-awaited step toward equitable access to education. While some experts have called for additional measures such as improved monitoring and career guidance, the interest-free loan scheme is being viewed as a strong move toward educational empowerment and socio-economic upliftment in Bihar.

With this reform, Bihar joins the ranks of progressive states offering comprehensive financial support for students pursuing higher studies. The implementation of this scheme will be closely watched in the coming months as students begin to apply under the new provisions.