This Article is From Jun 08, 2016

Education Loan Defaulters Disqualified From Applying For SBI Jobs: Court

Chennai: Madurai bench of the Madras High Court has issued a notice to the State Bank of India ordering that applicants defaulting on loan payments should be disqualified and barred from applying for jobs at the bank.

In its recruitment drive for Probationery Officers, Junior Associates and Junior Agricultural Associates, the bank has said those who have defaulted on loan repayments, even for credit cards, will not be eligible to apply.

The decision has left many like Ravi Kumar - a young engineer from Chennai - shattered. Ravi has still not been able to repay the three lakh-rupee loan he took for his education. After couldn't get an engineering job a year after he cleared B.Tech with 70 per cent marks, he wanted to try his luck for the SBI job. But now, he can't.

"It is unfair.  We borrow money only because we don't have assets. I get no salary. Without jobs how can we repay?" he complained.

A few years ago, the SBI had shamed educational loan defaulters by displaying their pictures in the Theni district of Tamil Nadu. Activists are up in arms. They call its latest move a rights' violation.

"This denies them the right to livelihood and there by right to live. In that sense it is a rights' violation. Who are they to impose those conditions? There's a rule of law when it comes to default and recovery," said Henry Tiphagne, Executive Director, People's Watch.

"This is against constitution," says Y Krishnan, the counsel for the petitioner.

However, some post-graduate student Nanditha Wilson are not against the move. "Without repayment, how would others get loans?" asked Nanditha.

Officials of the State Bank of India have refrained from commenting saying they would reply only to the court notice.

Banks claim they face a nine per cent default in around sixty thousand crore educational loans. They attribute this to   to poor quality education and consequent unemployment.

Some, authorities say, deliberately default and wait for waiver. However education loans, many say, are negligible when compared to defaults in corporate loans.