PM-Vidyalaxmi scheme for higher education gets nod

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Last Updated08/11/2024

The Union Cabinet chaired by Prime Minister Narendra Modi on Wednesday (November 6, 2024) approved a new Central Sector Scheme, PM Vidyalaxmi, which seeks to provide financial support to meritorious students in their pursuit of higher education.

The Union Cabinet, led by Prime Minister Narendra Modi, has approved a new scheme, PM Vidyalaxmi, to provide financial aid to meritorious students seeking higher education. This initiative is designed to make quality education accessible through financial support from banks and financial institutions.

Eligibility Criteria: Students who secure admission in any of the top 860 Quality Higher Education Institutions (QHEIs) in India, both government and private, can apply for loans under the scheme.
Collateral-Free Loans: Eligible students can receive collateral-free and guarantor-free loans to cover the entire cost of tuition and related expenses.

Credit Guarantee for Loans: For loans up to ₹7.5 lakh, a credit guarantee of 75% will be provided to encourage banks to offer education loans to students.
Interest Subvention for Low-Income Families: Students with an annual family income of up to ₹8 lakh, who do not qualify for other government scholarship or loan subsidy schemes, will be eligible for a 3% interest subvention on loans up to ₹10 lakh during the moratorium period.
Beneficiaries: This benefit is available to one lakh students per year, with preference for those from government institutions in technical or professional courses.

Outlay and Timeline: The government has allocated ₹3,600 crore for the PM Vidyalaxmi scheme from 2024-25 to 2030-31.
Student Coverage: Approximately 7 lakh new students are expected to benefit from the interest subvention over this period, with a potential reach of 22 lakh students across all aspects of the scheme.

Top QHEIs: The scheme applies to institutions ranked within the top 100 in the National Institutional Ranking Framework (NIRF) in overall, category-specific, and domain-specific lists.
Extended Coverage: It also includes State government-run HEIs ranked between 101 and 200 in the NIRF rankings and all Central government-governed institutions.