The loans are part of the efforts to reduce financial burden on households, and the students must repay the loans within six to ten years after graduation, the ministry said.
Tuition fees is a big financial burden for most of the country's households which on average earn a monthly income of 700,000 to 800,000 tugrik (284-324 US dollars).
In Mongolia, students need to pay 2 million tugrik (about 850 US dollars) on average annually for a Bachelor's degree, while a Master's degree costs 2.5 million tugrik per year on average.
In February, the Mongolian government decided to remove interest rates from its student loans. The interest rate of the loans was 5 percent before the removal.