PM Vidyalaxmi Scheme for Higher Education Loans

#GS-2 #Governance & Social Justice #Education #Government Policies & Interventions #Current Events #National

Why in News

The Ministry of Education recently highlighted the PM Vidyalaxmi Scheme to help talented students access higher education.
The scheme offers collateral-free loans and interest support for students entering top Quality Higher Educational Institutions (QHEIs).
This initiative helps fulfill the goals of the National Education Policy 2020 (NEP 2020) and Sustainable Development Goal 4 (SDG 4).

The PM Vidyalaxmi Scheme operates as a central initiative with a total outlay of Rs 3,600 crore spanning from 2024-25 to 2030-31 to support 7 lakh students.
Its main objective is to prevent financial difficulties from stopping talented students from studying in top colleges.
Students getting merit-based seats in 1,425 QHEIs, including top 100 NIRF institutions and top 200 State Government colleges, qualify for this benefit.
The loan covers all approved degree and diploma courses without any upper borrowing limit, covering tuition fees, hostel charges, books, and laptops.
For loans up to Rs 7.5 lakh, the government offers a 75% credit guarantee, keeping the maximum interest rate at EBLR + 0.5%.
Students can repay their loans over 15 years after their course and a one-year moratorium, borrowing through Scheduled Commercial Banks, RRBs, or Cooperative Banks.
Families with annual income up to Rs 8 lakh get a 3% interest subvention on loans up to Rs 10 lakh, while those earning below Rs 4.5 lakh get 100% interest subvention under PM-USP CSIS.
Students can complete loan applications, track status, and receive money digitally through the PM Vidyalaxmi Portal and PM Vidyalaxmi CBDC Wallet.

In FY 2025-26, out of 6,45,514 total education loan applications received on the central portal, 1,10,667 applications came specifically under the PM Vidyalaxmi Scheme.
The scheme showed strong implementation results with 70,852 loans sanctioned and 67,728 loans disbursed directly to deserving candidates.
The platform promotes equal access for male, female, and transgender applicants, recording 3,68,742 male applicants and 2,76,764 female applicants during FY 2025-26.
The initiative ensures social inclusion by extending support to EWS, OBC, SC, ST, PwD, and General category students across India.

The PM Vidyalaxmi Scheme is a central initiative providing collateral-free loans and interest assistance to meritorious students in recognized colleges.
Students with an annual family income under Rs 8 lakh can receive a 3% interest subvention on loans up to Rs 10 lakh during their moratorium period.
The coverage extends to 1,425 QHEIs, including top 100 NIRF institutions, top 200 State Government colleges, and all Central HEIs.
Borrowers can clear their loan balances within a maximum period of 15 years, which starts after course completion and a one-year moratorium.