It’s yet another gaokao season, when more than 10 million students across the country take one of the most important exams of their life on the path to fulfill their academic dreams. In supporting them, CDB's student loan service is also ready to become a strong backing for students with financial difficulties, and make their life easier as they embark on a new journey in life.
As one of the main banks providing national student loans, CDB, under the guidance of the Ministry of Education, Ministry of Finance, People's Bank of China and CBRC, has been committed to supporting education-related poverty alleviation through national student loans for many years, thus effectively safeguarding the right to education of students from economically disadvantaged families, promoting educational equity and preventing the inter-generational transmission of poverty. By the end of 2020, CDB had issued a total of 229.2 billion yuan in student loans, supporting 34.99 million person-time and 14.77 million students from economically disadvantaged families. In the past five years, the annual disbursement of CDB student loans has maintained a ratio of over 85% of the national total, and on average, one out of every six freshmen students is supported by CDB student loans.
Innovating model and constructing the mechanism of "bank-education cooperation". CDB's effort to provide student loans can be traced back to Henan in 2004, when the bidding for student loan service in Henan Province was aborted, meaning that millions of students would not receive financial assistance from student loans in the coming year. Upon the news, CDB took the initiative to rise up to the challenge by overcoming the disadvantage of its own few service outlets and personnel, and cooperating fully with the Henan Provincial Department of Education. Relying on education loan management centers at all levels and student loan management agencies of universities, a "bank-education cooperation" mechanism was put forward, as a "Henan model" of student loans. In 2007, CDB was the first bank in China to offer student credit loans, allowing students to apply for loans at home. As of May this year, CDB student loans have covered all 2830 colleges and universities recognized by the Ministry of Education.
Lending as much as possible so that no poor student is left behind. Equity in education is of paramount importance. CDB implements the requirements of inclusive finance and insists on "lending as much as possible", with no restrictions on the scale of loans and number of recipients, no additional conditions, no fees, and the interest rate of the loans is 30 basis points less than the quoted market rate for loans of five years or more. Since the 18th National Congress of the CPC, CDB has even expanded the scope of loan recipients to cover all stages of higher education, be it public or private schools. In 2020 alone, CDB issued student loans of 33.5 billion yuan to 4.5 million students from economically disadvantaged families.
Realizing one-stop, electronic loan processing and covering financial security education throughout the process. Student loan is the first financial product that students with financial difficulties come into contact with when they enter society. Over the years, CDB has gradually established the "Student Loan IT System Group" and "95593 Student Loan Call Center", which enable one-stop, paperless loan application at home. The direct, convenient and fast financial services allow thousands of students from remote and mountainous areas to experience the charm of modern financial services. At the same time, in the face of poor students who are exposed to financial products for the first time, CDB makes a dedicated effort to strengthen financial security and integrity education, popularize the prevention of campus financial fraud and other safety knowledge throughout the entire process of loan processing, help students enhance the concept of honesty and trustworthiness, so as to enhance the awareness of risk prevention, and realize the combination of financial support and education.
Creating a full range of services for poverty alleviation in education. CDB regards student loans as an effective means to interrupt the inter-generational transmission of poverty and uses student loans as a grip to promote education-related poverty alleviation. CDB allows for pre-applications for students in difficulty, including those in unstable state of poverty, orphans and disabled, children of martyrs, children of disabled people, and students who have received state grants in high school. CDB has determined their eligibility to student loans before the college entrance examination, eliminating the worries of those students. CDB also focuses on the employment of students from economically disadvantaged families, and under the guidance of the Ministry of Human Resources and Social Security and the Ministry of Education, CDB helps support the smooth employment of students in difficulty through various measures, such as organizing job application skills training, special job fairs, and providing targeted internship employment positions. To help students from impoverished families, CDB has conscientiously implemented the national policy by using the balance incentive funds from the national student loan risk compensation fund to repay the principal and interest of student loans on behalf of students. Thus a full-fledged poverty alleviation and relief system takes shape.
The person in charge of the Inclusive Finance Department of CDB said that CDB will further play the role as the main bank for student loans, continue to cooperate with relevant departments to explore and improve the service model, enhance student loan services, promote inclusive financial services, strengthen financial security education, and actively support the role of education in poverty relief, so as to utilize development finance to brighten the wonderful life path of students from poor families.
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