- Loans from about 25 lakhs to 5 crores from non-banking financial institutions to aid educational facilities
- Funds required for construction of the building and renewal, land purchase, infrastructure- laboratory, development of sports ground, school buses and other pedagogic facilities
Mumbai: Due to constant reduction in Government subsidies and complex loan processes by nationalized banks several educational institutions across the state turn to Non-banking Financial Institutions (NBFC) for funds. It is interesting to notice that along with private educational institutions a lot of aided schools are also seeking help from NBFC to raise funds for developing their school infrastructure, an effort initiated to upgrade the quality of education.
Sangli based Vaibhav Educational Institute, situated in Vita is one such educational institute who has applied for educational loan from ‘Auxilo’, a pan-India NBFC. The institute situated in Navarupa has been functional for the past two decades. The institute has initiated the process to raise additional funds for the development of their educational facilities, such as the sports ground, upgrading the laboratories and classrooms for their school and junior college students.
Post an application submitted by Vaibhav Educational Institute to the non-banking financial institution, they were sanctioned a grant of around Rs. 1 crore recently. Nandkumar Patil, Director of Vaibhav Educational Institute said, “Educational institutions face a lot of hurdles while applying for an educational loan from nationalized or private banks. Their process is complicated and time-consuming. On the other hand, NBFC processes the application faster, providing the required funds in the shortest time. This helps to upgrade the educational institutes and develop new centres of learning.”
Kindergartens and play school franchises, schools, junior colleges, degree colleges, institutes providing vocational training are turning in large numbers to NBFC to meet their developmental requirements. This trend is not just confined to cities, as semi-urban and rural educational institutions are following this option to raise funds. At present, 150 educational institutions in the country have applied for financial funding from Auxilo Finserve Pvt Ltd. Of the 150 educational institutes, 30 are from Maharashtra alone. Schools affiliated to different educational boards like SSC, CBSE, ICSE, IB and others are trying to raise funds through NBFC.
Elaborating on the recent trend, Neeraj Saxena, Managing Director of Auxilo Finserve said, “Institutions face shortage of funds for construction and renovation of their school building, land purchase for educational institutions, infrastructure development, purchasing of school buses and other educational utility-related facilities. Maximum capital is required for the construction of educational buildings. We have provided funds worth Rs 25 lakhs to 5 crores to these education institutes in the form of loans.”
“Educational institutions have been facing several problems to raise loans from banks. However, special financial institutions are now providing customized financial solutions to aid the educational sector. Additionally, due to the increasing financial realization among the promoters of educational institutions, Auxilo is accepting the option of raising loans for the qualitative and quantitative expansion of their educational institutions. We are determined to raise the bar of education in the country to build a developed nation.”