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Wednesday, September 27, 2017

SBI not credited 534 crores of interest subsidy to Education Loan borrowers, after receiving from Government - Needs CBI enquiry



26 Sep 2017

This is the mail sent to Central Vigilance commissioner, Delhi under copy to Ministry of Finance and Ministry of Human Resources Development.  

Dear Sirs

During the 7 years period between 2009 and 2016, State Bank of India has not credited Rs.534 crores of Education Loan Interest Subsidy received from Government of India, to the eligible student borrowers.  They have denied legitimate subsidy to eligible poor students.  It is also understood that SBI has not returned the amount to the Government also.  If this happens at individual level, this will be called 'misappropriation' leading to criminal offense.

Times of India, Chennai edition has carried a front page story on 24th September 2017.  We attach herewith the pdf version of the story.  The story can be read in the following link also.


This is only a tip of the iceberg.  There may be similar 'misappropriations' in other banks also denying legitimate subsidy to eligible poor education loan borrowers.   In view of this, Education Loan Task Force (ELTF) requests Central Vigilance Commissioner (CVC) and Ministry of HRD to consider the following:

1.  CBI enquiry may be ordered to investigate as to why State Bank of India did not credit the eligible subsidy to the borrowers over a period of 7 years and how the money was appropriated. The Senior Executives responsible for such lapses should be prosecuted for misappropriating the Subsidy amount. 

2.  Investigate all the Banks for such lapses to find out whether the entire subsidy amount received from the Government is credited to the beneficiaries.

3.  CAG may be requested to audit all the interest subsidy accounts of all the borrowers in the banks and suitable action may be initiated against the officials for any lapses. (CAG has authority to audit any institution which receives Subsidy from the State or Central Government)

Yours faithfully

K. Srinivasan
Convenor, ELTF


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