Coimbatore: Students who default on education loans could face serious consequences including trouble securing jobs, housing loans, or even marriage alliances, bank officials have cautioned.

Education loans are intended to support students pursuing higher studies without financial hindrance. However, officials say that rising defaults have made several banks wary of disbursing fresh education loans, particularly in regions where non-performing loan levels are high.

“In the past, we have seen a number of students defaulting on repayment. If this trend continues, banks may be forced to tighten loan approvals or even deny education loans in certain areas,” a senior bank official said.

Students are advised to consult with bank officials before applying for a loan, particularly to understand eligibility and repayment terms. The official stressed that responsible borrowing and timely repayment are critical to maintaining a good credit score.

“A poor credit score can impact future financial plans, including buying a home or a vehicle. In some cases, employers also check credit scores during background verification. A history of loan default can therefore become a barrier to employment,” he added.

Highlighting the growing relevance of credit scores, the official noted, “Today, even marriage proposals involve checking CIBIL scores. A default on education loans could close many doors. Repayment is not just a financial obligation but a crucial step in securing one's future.”