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The Union Cabinet, chaired by Prime Minister Shri Narendra Modi, on 6 November approved PM Vidyalaxmi, a new Central Sector scheme that seeks to provide financial support to meritorious students so that financial constraints do not prevent anyone from pursuing higher studies. PM Vidyalaxmi is another key initiative
stemming out of the National Education Policy, 2020, which had recommended that financial assistance should be made available to meritorious students through various measures in both public and private HEIs. Under the PM Vidyalaxmi scheme, any student who gets admission in quality Higher Education Institution (QHEIs) will be eligible to get collateral free, guarantor free loan from banks and financial institutions to cover full amount of tuition fees and other expenses related to the course. The scheme will be administered through a simple, transparent and student-friendly system that will be inter-operable and entirely digital.
• A mission mode mechanism will facilitate and drive the extension of education loans to meritorious students who get admission in the top 860 quality higher educational institutions of the nation, translating to covering more than 22 lakh students every year.
• A special loan product will enable for collateral free, guarantor free education loans; made accessible through a simple, transparent, student-friendly and entirely digital application process
• Loan amounts up to Rs. 7.5 lakhs will be provided a 75% credit guarantee by the Government of India, to support banks to expand coverage
• Furthermore, for students with up to Rs. 8 lakhs annual family income, the scheme will also provide for 3% interest subvention on loans up to Rs 10 lakh
• This is in addition to the full interest subvention already offered to students with up to Rs. 4.5 lakhs annual family income
• PM Vidyalaxmi will build on the scope and reach of initiatives taken over the last decade for maximizing access to quality higher education for the youth.