Over 10% of education loans from PSB were given out in Kerala.

Education loans from public sector banks have significantly increased after the pandemic, with Kerala receiving 13% of all education loans disbursed in the country. Public Sector Banks in India have disbursed more than 10% of IBA model education loans in Kerala, a state with a population of 3.57 crore people. The Model Education Loan scheme by IBA allows for collateral-free education loans up to ₹7.50 lakh, with no margin for loans up to ₹4 lakh. Repayment period after the moratorium is up to 15 years for all loans. PSBs disbursed a total of ₹1.08-lakh crore as education loans between FY21 and the third quarter of FY24. In Kerala alone, PSBs disbursed 13% of education loans totalling ₹14,421 crore. The Kerala government launched the Education Loan Repayment Support (ELRS) scheme in 2017 to aid students with education loans not exceeding ₹9 lakh and family income not exceeding ₹6 lakh per annum. The state government bears 90% of the repayable amount in the first year, 75% in the second year, 50% in the third year, and 25% in the fourth year. This has led to increased demand for education loans in Kerala.