The Union Cabinet has approved the PM-Vidyalaxmi scheme, aimed at providing financial support to meritorious students pursuing higher education in both public and private institutions.
Announced on Wednesday, the scheme is designed to offer collateral-free, guarantor-free education loans to students who secure admission to one of the top 860 Quality Higher Education Institutions (QHEIs) in India.
This includes both government and private institutions, making it accessible to a wide range of students.
The PM-Vidyalaxmi scheme is expected to benefit around 22 lakh students. It allows them to take loans that will cover the full cost of tuition fees and other related expenses for their courses.
For loans up to Rs 7.5 lakh, students will receive a 75% credit guarantee, making it easier for banks and financial institutions to approve and disburse loans. This provision is aimed at reducing the financial risk for lenders and encouraging them to support more students.
In addition to these benefits, the scheme provides interest subvention for students whose annual family income is up to Rs 8 lakh, and who are not receiving any other government scholarship or interest-subvention benefits.
These students will receive a 3% interest subsidy on loans up to Rs 10 lakh during the moratorium period, which refers to the time between the loan disbursal and the beginning of repayment.
The government plans to extend this interest subvention to 1 lakh students each year, with a particular emphasis on students from government institutions who are enroled in technical or professional courses.
The scheme has a financial outlay of Rs 3,600 crore for the period between 2024-25 and 2030-31, with the expectation that 7 lakh fresh students will benefit from the interest subvention during this time.
This initiative aims to make higher education more accessible by reducing the financial burden on students and their families.
The PM-Vidyalaxmi scheme will apply to a wide range of top-ranked institutions, as determined by the National Institutional Ranking Framework (NIRF).
This includes institutions that rank within the top 100 in overall, category-specific, and domain-specific lists, as well as state-run universities ranked between 101 and 200. Additionally, all Central government-run institutions are eligible under the scheme.
