Uttar Pradesh is seeing a rise in education loans but a decline in the outstanding amount, signaling a robust credit flow in the sector.
During the first nine months of FY24 (April to December), around 30,000 fresh education loans amounting to nearly Rs 1,028 crore were disbursed in the state. This is a 30 per cent jump over the same period of FY23, when more than 28,000 fresh education loans worth Rs 787 crore were disbursed.
On the other hand, the outstanding education loans dipped 4.5 per cent to Rs 5,642 crore in December 2023 from Rs 5,908 crore the same month a year ago, according to data released by the State Level Bankers’ Committee (SLBC).
The domestic education loans segment, which slowed in 2016 owing to high non-performing assets (NPAs), is starting to grow.
Public-sector banks lead private peers in granting education loans in the state by securing nearly 80 per cent of fresh advances.
However, the services sector loans, which include education and housing, continue to be a laggard in achieving targets as compared to agricultural and micro, small, and medium enterprises (MSME) advances.
The services sector advances secure less than 30 per cent of their annual targets, while the agricultural and MSME sector account for more than 50 per cent and 140 per cent, respectively.
In the past few years, UP has also logged high growth in digital economy and concomitantly in digital banking.
In UP, the number of digital transactions jumped nearly threefold to 11.74 billion in FY23 from 4.26 billion in FY22.
Besides, the state is witnessing penetration of financial products, including insurance and shares trading.
Bajaj Allianz Life Chief Agency Officer Sameer Joshi said: “UP is among the fastest-growing financial products, including insurance markets in India.” He said the bouquet of big-ticket projects were boosting the state’s economy and driving growth in other sectors.
First Published: Mar 25 2024 | 5:18 PM IST