PATNA, Aug. 22 -- A day after facing sharp criticism for reducing the loan limit under Bihar student credit card scheme (BSCCS), the state higher education department on Friday clarified that students will receive additional financial assistance ranging from Rs.2 lakh to Rs.4 lakh under Central government schemes, besides the Rs.2 lakh assistance provided by Bihar state education finance corporation (BSEFC). Reports claiming a reduction in education loans available under the scheme are "factually incorrect," the state government asserted in a press release issued on Friday. According to the secretary of the higher education department, an education loan of up to Rs.2 lakh will now be disbursed through the BSEFC, while assistance between Rs.2 lakh and Rs.4 lakh will be channelled through scheduled commercial banks. Previously, the entire amount of up to Rs.4 lakh was provided solely through the state corporation. The controversy over BSCCS erupted when state higher education department issued a detailed notification on Wednesday, in which the loan limit from the BSEFC was reduced to 2 lakh against earlier limit of Rs.4 lakh. In the press release, the higher education department stated that the restructuring integrates the BSEFC with the Pradhan Mantri Uchchatar Shiksha Protsahan Yojana (PM-USP), the PM VidyaLakshmi Portal and banks, with the explicit objective of extending institutional financial assistance to the maximum number of students. Under the PM VidyaLakshmi Yojana, students can access education loans of up to Rs.10 lakh. Officials insist students now have more options for higher education financing than before. Budgetary figures were cited as proof of expansion rather than contraction. An expenditure of Rs.886 crore was approved for the scheme in 2025-26; for the current financial year 2026-27, Rs.950 crore has been sanctioned-an increase of Rs.64 crore. "The figures clearly indicate that the provision for financial assistance under the BSCCS has increased, not decreased," the release stated. The government's stated aim is to deliver "accessible, comprehensive and institutional financial assistance" so that the largest possible number of students benefit. On paper the numbers look robust. Since its launch, the state has approved 481,000 loan applications under the scheme. About 415,000 lakh students have received financial assistance totalling Rs.8,865 crore, while loans worth Rs.15,801 crore have been sanctioned. Around 3,400 institutions in Bihar and outside the state are registered under the programme. A section of students, however, were restive after the higher education department issued a formal notification reducing the limit of loan amount under the BSCCS, saying that the fine print raises legitimate questions. "Under the pure state component, students earlier paid 4% interest (1% for female, Divyang and transgender borrowers); recent changes had made the state-backed portion interest-free. For the additional amounts routed through banks under PM-USP CSIS and PM VidyaLakshmi, standard commercial interest rates will apply, though the state can offer up to 30 per cent interest subsidy," said a student leader Vimal Kumar. He further stated that no credit guarantee is provided by the Centre on these student loans, but Bihar has decided to extend a 75% credit guarantee for loans under its own student credit card scheme. "Shifting a significant portion of financing to banks introduces commercial interest burdens and procedural hurdles that poorer students may struggle to navigate, effectively diluting the scheme's original promise of low-cost, state-backed support," he added. Opposition party leaders condemned the state government's decision on BSCCS. Leader of the opposition Tejashwi Prasad Yadav described Bihar's fiscal situation as a "serious financial crisis," pointing to a public debt surge and a fiscal deficit of 5.8% of GSDP in 2025-26-the highest among major states. He accused the BJP-led NDA government of corruption and mismanagement, claiming funds were falling short for salaries, pensions, contractors and developmental programmes. Yadav specifically alleged that allocations under the BSCCS had been reduced and scholarships curtailed, arguing that the government lacked any long-term strategy to boost revenue or contain the deficit despite record borrowing over the past two years. Bihar Pradesh Congress Committee (BPCC) president Rajesh Ram was equally scathing. He charged the government with systematically weakening support for higher education by cutting the effective state-backed loan ceiling, calling it a betrayal of Bihar's aspirational youth at a time when the cost of professional courses continues to rise. Ram said the restructuring amounted to shifting the burden onto commercial banks while the state's own fiscal mismanagement left genuine students exposed. When contacted, higher education minister Sanjay Tiger refused to discuss the vexed issue, saying that everything has been clarified in the press release issued by the department....