IIMs urge banks to extend student debt repayment schedules

Top business schools of India are seeking an extension for student debt repayment schedules by six months or more. For student loan, this is beyond the inbuilt moratorium that most lenders offer. However, according to many senior bankers, students are already being given adequate moratorium and an extension was not required. The Indian Institutes of Management expect interruptions in onboarding of students graduating this year. Apart from this, they are not ruling out problems for the class graduating in 2021 as well. In December, the first installment for graduates with student loans for the class of 2020 will be due. Most banks have an in-built moratorium clause in their student loans.

From the date of completion of the course, the extension is usually for six months or one year. With student loans for the class of 2020, the first installment for graduates will be due in December. In their student loans, most banks have an in-built moratorium clause. Generally, the extension is for six months or one year from the date of completion of the course. For the class graduating in 2020, the two-year courses of IIMs cost between Rs 9 lakh and Rs 22 lakh. Some IIMs such as IIM Indore, have officially commenced the process of getting a further extension.

In case the recruitment process gets postponed, other IIMs such as Ahmedabad, Lucknow, Kozhikode and Raipur are likely to mediate. According to Anand Subramanian, business head (education loans) of Bank of Baroda, when they give an education loan, there is a one-year extended moratorium period. The option is available on all student loans taken for full-time courses.
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