Student debt in B'luru: A growing problem that needs attn

Sowmya Raju | NT

Bengaluru: Bengaluru is known for its high cost of living, which is taking a toll on its students.

In recent years, there has been a sharp increase in student debt in the city, with many students taking loans from third-party apps and local loan sharks to finance their luxurious lifestyles.

Recently, a 22-year-old engineering student named Thejas (22) died by suicide after being harassed by recovery agents of digital loan apps. He had borrowed money from these apps for a friend who had failed to repay the loan.

The recovery agents started harassing Thejas, who was unable to bear the pressure and ultimately committed suicide. One reason for this issue is the increasing pressure on students to maintain a luxurious lifestyle.

Many students feel the need to keep up with their peers, leading them to spend more money than they can afford. This is especially true for students who are living in hostels or paying rent, as they may feel compelled to furnish their rooms and buy expensive food and clothes.

The easy availability of loans has also contributed to the problem. There are numerous third-party apps and local loan sharks willing to lend money to students, often with minimal documentation, making it easy for students to get into debt without fully understanding the terms and conditions of the loan.

Adarsh Benkappa Basavaraj, a student advisor, warned students about the dangers of unsecured loans offered by Chinese loan apps.

He pointed out that these apps often have high interest rates and can be difficult to repay, even if students intend to do so. Adarsh shared the story of a student who had borrowed money from a Chinese loan app and was subsequently harassed by the app's recovery agents.

The student received multiple calls and messages, and the app even sent a message to all of the student's contacts, stating that he owed money to them and that it had not been repaid.

This humiliation pushed him to attempt suicide, but he was saved later. The consequences of student debt can be severe. Adarsh strongly advised students to live within their means and to avoid taking out loans unless absolutely necessary.

He emphasized that students should resist the temptation of leading a lavish lifestyle or seeking instant gratification. Adarsh cited the example of students who borrow money to take their love interests on expensive dates or buy them expensive gifts.

He mentioned that this is a major reason why students turn to loans and stressed the importance of students understanding that this is not the time to invest heavily in their love interests.

He also warned students about the dangers of unsecured loans, which often come with high interest rates and can be difficult to repay. Furthermore, he urged students to firmly reject alcohol and drugs.

He said, “These are the types of expenses that students often keep hidden from their parents, leading them to take unnecessary loans.”

He added, “Do not believe in the concept of 'fake it till you make it' and do not get influenced by social media 'riches' as well.”