Bangalore: Not wanting to let pilot shortage ground its sky-high aspirations, budget airline SpiceJet Ltd has come up with a novel way of facilitating cadets for pilot training in acquiring loans from banks at lower interest rates and an easy repayment scheme.
And, it is doing this by providing ‘surety of job’ to students wanting to enrol for training but cannot afford it. In effect, it is acting as guarantor for the students who borrow from banks for their course.
The low-cost carrier has tied up with the flying school – United Aviation – which helps students raise loans from Centurion Bank of Punjab. Under the scheme, students can raise a loan of up to 100% of their fees (close to Rs 16 lakh for both local and overseas training) at an interest rate of 9.5-10.5%, depending on their ability. This would not be repayable until six months of joining their service at SpiceJet. That is, the bank would start drawing EMI only after they have started earning their full salaries.
Besides United Aviation, Centurion Bank of Punjab has also tied up with other pilot institutes like Aerostar, High Fly and others for disbursing loans to commercial pilots training. In 2006, it has processed around 50 applications for commercial pilot licence.
United Aviation has begun talks with Bank of Maharashtra, J&K Bank and HDFC Bank.
The school has also approached Jet Airways for a tie-up. Meanwhile, SpiceJet is preparing to take on board the first batch of 24 pilots from this scheme in June this year. Even though this will meet only part of its requirement of 80 pilots this year, it would ease the pilot crunch to some extent.
16/01/07 Praveena Sharma/Daily News & Analysis