Explained | The NAC Bank will allow students to drop a course and join another, without losing credits

Bhopal's Satish Mehta had to move to Mumbai after his first year of postgraduate education due to his father's transferable job. Not only did have to deal with the blow of losing a year, his project on use of artificial intelligence in hospitals was also not considered.

He would have immensely benefitted if the proposed National Academic Credit Bank (NAC Bank) existed at that time.

The University Grants Commission (UGC) has proposed the NAC Bank, which gives students the flexibility to transfer credits from one institute to the other, and also enables multiple points of entry/exit.

Once NAC Bank comes into force, a student who is facing a similar situation like Satish can directly join an institute for the second year MSc course. Further, the project completed in Bhopal will also be considered for his science degree in Mumbai.

UGC on December 11, released a concept paper on NAC Bank. This was an attempt to liberate the Indian higher education system from a slew of regulations and regulators.

Here, NAC Bank will be a digital/virtual entity managed by the human resource ministry and UGC. It will work like a commercial bank providing a variety of services including academic credit verification and degree authentication.

NAC Bank will provide deposit accounts to all students enrolled in higher education institutions in the country. The academic credits earned by a student in the system can be automatically credit to his/her account. After accumulation of a certain number of credits, students can accrue and redeem the credits for any academic programme.

This could be a degree, diploma or certificate and can be redeemed at a convenient time.

UGC has said that the NAC Bank will give the students the complete autonomy to plan their learning modules. This can also be shared with companies for employment purposes.

Students can also choose the mode of education and pace. For instance, one student could complete a degree in three years while another could take five years. A student can also choose which location to choose for their education.

The credits will be valid for eight years. Hence, students have ample time to get their degrees/diplomas.

Fee could also get lower. Unlike a regular course where fee is charged per year, NAC Bank will charge fee on a per-credit basis.

Indian education system mandates that a degree be completed in three to four years. Usually when a student quits one institute and joins another, he/she is required to start from scratch. The projects and academic credit completed in one institute do not get transferred to another institute unless there is a specific agreement for the same.

This becomes detrimental for students who either dropout of programmes they are not interested in, or shift cities. Some individuals also take up employment opportunities before completing their graduation due to family pressures. Under a NAC Bank, such students will also be allowed to complete their credits.

A NAC Bank provides multiple entry/exit points for students as far as academic programmes are concerned. It also provides an option for course corrections throughout the academic life. For instance, if a student thinks he wants to pursue a pure science degree rather than engineering he/she can drop out of one course and join the other without losing a year. All credits will be transferred seamlessly.

Similarly, a student may find a short-term study opportunity abroad. He/she can take up that programme and come back and add those credits to the NAC Bank.

Initially, it will be allowed for all postgraduate programme. UGC has mentioned courses like MA, MCom, MSc (science and catering) and MBA among others.

Only Indian institutes and universities can offer NAC Bank services. UGC said that regulating foreign universities for this proposal could be a challenge and hence they have been kept out of it.

NAC Bank will work under a standard framework under UGC. The scheme will also transfer credit from one institution to another, one department to another and one specialisation to another.

It will facilitate migration of students between institutions and specialisations from time to time. Each institute has to formally qualify and agree to be a part of the NAC Bank.

Once an institute joins this programme, they will have restructure the entire academic process beginning from registration, admission, course requirements, fee, attendance, credits as well as the nature of degree offered.

All credits earned will be stored in the NAC Bank. Once the credit is used for any award/degree, it is debited from the bank. It is proposed that a student must earn at least 50 percent of the credits from the parent institution.

UGC said that this will enable lifelong learning for students. Further, due to the multiple entry/exit points, it is aimed at boosting the gross enrollment ratio in India beyond 50 percent in 10 years.

Depending on the lessons learnt, the scheme will reviewed after two years to make any structural changes, if needed.

The colleges may not be amused, as their fee income may come down. Also, they would have to incur costs to re-design their courses.

Also, at present the 'value' of each credit is not clear. For instance, will a credit score from an architecture course have the same value as from a mechanical course.

This is just a proposal right now. The UGC will hold discussions with stakeholders, who have to submit their views by December 20.

The UGC will then submit the proposal to the HRD Ministry. At present, there is no timeline .