Analysis of Perception Levels with Respect to Alternate Education Loan Repayment Plans in India.

Abstract

On account of high NPA’s in the education loan sector specially in the Southern states of India, efforts are being made to mitigate such losses. Countries like US., UK and many facing such problems had introduced income contingent plans to reduce the mounting losses from NPLs. In this paper, an effort has been made to check the viability of such a scheme in India by analysing the perception levels of the youth across financial literacy, risk aversion and future labour outcomes in India towards such alternative education loan repayment style. The results state that the sample is financially literate and expects favourable labour outcomes and have not shown willingness towards the take-up of the new scheme. It is an initial study conducted on a small sample base and requires extensive research on the same to gauge the willingness and if not, why.