One of the most important times one needs money is when one opts for higher education in a university either in India or abroad. Most of the options available for higher education are extremely costly and some that are completely out of the reach of the ordinary man. What happens in such situation is that one is left with no choice but to approach a bank for money in the form of a loan which can be paid back later.
Every year, thousands of students apply to banks for student loans. Some of them are trying to go abroad while others try to study in prestigious institutions in India. But nowadays, getting an educational loan is not as simple a process as it used to be.
Many banks have made it mandatory for students to have PAN cards and are actively denying student loan to anyone who doesn’t have a PAN card. This has made life a lot harder for people who don’t have PAN cards. This step has been taken by banks in order to weed out any sort of financial misconduct on the part of the student since the PAN card can be used to check any sort of transactions that have taken place.
This step has come after a lot of irregularities and financial misconduct on the part of a lot of students who also defaulted on their loans. Since the amount of money loaned to the students is generally huge, it is extremely important to the bank to trace back the money and get it back in time. But it becomes extremely difficult for a bank to trace the whereabouts of the students once they go abroad and settle there. In a majority of these cases, the students default and do not pay their loans back.
The application of the PAN card will ensure that the student s can be traced by the bank anytime using the trace of their financial activity and therefore the student will be discouraged from trying to default from the loan. They can also be exposed the next time they try and go to a bank to take a student loan.
However, it is not as difficult as it seems. Students need to only start an account in their name in any of the many recognized banks in India and then go on to the income tax department website. There they need to fill up the form 49A online using all the guidelines specified and the necessary documents and photographs. The documents that are required include a proof of identity and a proof of residence.
One then needs to submit the form online, take a print out of the acknowledgement slip that is automatically generated, generate a demand draft for Rs. 944 and send the demand draft along with the acknowledgement slip and the necessary document proofs to the NDSL office in Mumbai.
Not only does this hassle free process ensure that you get a PAN card, which is an important document proof for your financial activity, but ensure that you sail through while applying for an education loan.