PM-Vidyalakshmi Scheme: Collateral-free loans and interest benefits for students. Check eligibility, other details here
PM-Vidyalakshmi Scheme: The loans will be available through a streamlined, fully digital application process, ensuring transparency and ease of access. For loan amounts up to ₹7.5 lakh
Prime Minister Narendra Modi-led Indian government introduced the ground-breaking PM-Vidyalaxmi scheme to ensure deserving students can pursue high-quality higher education despite budgetary limitations. This program, which aims to improve access to education, provides many advantages, such as interest subsidies, loans without collateral, and a simplified online application
Who can benefit from the scheme?
The PM-Vidyalaxmi Scheme is aimed at students who secure admission into top-ranking higher education institutions (HEIs) nationwide. Eligibility is determined based on the National Institutional Ranking Framework (NIRF), which ranks institutions based on their academic and research performance.
Students admitted to:
Institutions ranked in the top 100, or in specific categories or domains.
State-level HEIs ranked 101-200.
All central government institutions.
The scheme covers 860 top institutions, with the list updated annually to reflect the latest rankings.
How does PM-Vidyalaxmi work?
The scheme provides education loans without collateral or guarantors, ensuring financial ease for students and their families. It also includes additional features to reduce the burden of repayment:
Credit Guarantee: For loans up to ₹7.5 lakh, the government provides a 75% credit guarantee, encouraging banks to extend loans to more students.
Interest Subvention: Students with family incomes up to ₹8 lakh annually are eligible for a 3% interest subsidy on loans of up to ₹10 lakh. This subsidy applies during the moratorium period (when the loan repayment is paused, typically during the study).
Students from families earning up to ₹4.5 lakh annually continue to receive full interest subsidy under existing government schemes.
PM-Vidyalaxmi: Key features
Inclusive Financial Assistance:
The scheme is designed for students from diverse economic backgrounds, and it offers special support to those with lower family incomes.
Simplified Digital Process:
Applications for loans and interest subventions are processed through a unified, student-friendly PM-Vidyalaxmi portal. The system is fully digital, ensuring transparency and ease of use. Disbursements are made via e-vouchers or Central Bank Digital Currency (CBDC) wallets.
Focus on Professional and Technical Education:
Students pursuing technical and professional courses in government or top-ranking institutions receive priority under the scheme.
Why is this Important?
With a budget allocation of ₹3,600 crore for 2024-2031, the scheme benefits over 22 lakh students annually. It also complements existing government initiatives, such as the Central Sector Interest Subsidy (CSIS) and Credit Guarantee Fund Scheme for Education Loans (CGFSEL), which provide financial support for professional education.
By addressing key barriers like high tuition fees and limited loan availability, PM-Vidyalaxmi ensures that deserving students can access the best educational opportunities. It also strengthens India’s vision of fostering equitable access to education, which isin line with the National Education Policy (NEP) 2020.
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Business NewsNewsIndiaPM-Vidyalakshmi Scheme: Collateral-free loans and interest benefits for students. Check eligibility, other details here
First Published:7 Dec 2024, 01:58 PM IST
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