What Is PM Vidyalaxmi Scheme 2024? Collateral-Free, No-Guarantor Student Loans; Know How To Apply

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The Cabinet, led by Prime Minister Narendra Modi, has approved the PM Vidyalaxmi scheme, dedicating a budget of Rs 3,600 crore for the period from 2024-25 to 2030-31. This initiative aims support an additional 7 lakh students through its provisions.

The PM Vidyalaxmi scheme is a government initiative to ensure affordable access to higher education for deserving students in India. Under this scheme, students who gain admission into quality higher education institutions (QHEIs) can avail collateral-free, guarantor-free loans from banks and financial institutions to cover tuition fees and other course-related expenses.

 Key Highlights of PM Vidyalaxmi Scheme

The PM Vidyalaxmi scheme provides financial support to students pursuing higher education in reputable institutions across India. It aims to eliminate financial barriers to higher education and make it more accessible for students from economically disadvantaged backgrounds.

Eligible Institutions for PM Vidyalaxmi Scheme

The scheme applies to India’s top-quality higher education institutions as determined by the National Institutional Ranking Framework (NIRF). Eligible institutions include:

• All higher education institutions, both government and private, ranked within the top 100 in the NIRF’s overall, category-specific, or domain-specific rankings.
•  State government institutions ranked between 101-200 in the NIRF.
• All centrally governed institutions, ensuring a wide selection of eligible schools for students seeking financial aid.

 Loan Amount and Credit Guarantee

For loan amounts up to ₹7.5 lakhs, the PM Vidyalaxmi scheme offers a 75% credit guarantee on the outstanding balance in case of default. This guarantee supports banks in offering more accessible education loans to students under the scheme.

 Interest Subvention for Eligible Students

Students from families with an annual income of up to ₹8 lakhs, and who are not already receiving government scholarships or interest subvention, are eligible for additional financial support:

•  A 3% interest subvention will be applied to loans up to ₹10 lakhs during the moratorium period.
• The scheme aims to provide this interest subvention support to one lakh students annually, with preference given to those enrolled in government institutions or technical/professional courses.

Funding and Expected Beneficiaries

The scheme has an allocated budget of ₹3,600 crore for the period from 2024-25 to 2030-31, aiming to support seven lakh new students during this time. This investment reflects the government’s commitment to empowering students in achieving their educational goals.

How to Apply for PM Vidyalaxmi Scheme?

The application process for the PM Vidyalaxmi scheme is simplified through a unified portal, “PM-Vidyalaxmi,” managed by the Department of Higher Education. Students can apply for education loans and interest subvention directly on this portal, which all participating banks will use.

The interest subvention will be provided through an e-voucher or Central Bank Digital Currency (CBDC) wallet for seamless disbursement.

 Eligibility Criteria for PM Vidyalaxmi Scheme

To qualify for the PM Vidyalaxmi scheme, students must:

• - Secure admission to a Quality Higher Education Institution (QHEI) as defined under the scheme.
• - Have an annual family income of up to ₹8 lakhs (for interest subvention benefits).

Additionally, under the PM-USP CSIS program, students from families with incomes up to ₹4.5 lakhs who pursue technical or professional courses in approved institutions are eligible for full interest subvention on education loans up to ₹10 lakhs during the moratorium period.

Together, the PM Vidyalaxmi and PM-USP CSIS schemes provide comprehensive support to students pursuing higher education in accredited institutions.