Cabinet Approves PM-Vidyalaxmi Scheme for Higher Education

The Union Cabinet, chaired by Prime Minister Narendra Modi, approved the PM-Vidyalaxmi scheme on November 6, 2024, aimed at providing financial support to meritorious students seeking higher education. The scheme ensures collateral-free, guarantor-free loans for students enrolling in top 860 Quality Higher Education Institutions (QHEIs) across India, covering tuition fees and other educational expenses. With an outlay of ₹3,600 crore, this scheme targets to benefit 22 lakh students annually, empowering them to pursue their academic dreams without financial barriers.

Key Features of PM-Vidyalaxmi Scheme

Eligibility and Loan Coverage: Students admitted to the top 860 QHEIs, including government and private institutions based on NIRF rankings, will be eligible for full education loans covering tuition and course-related expenses.

Loan Amount and Credit Guarantee: Students can avail loans up to ₹7.5 lakh, with a 75% credit guarantee for defaults, providing banks with security in loan disbursement.

Interest Subvention: Students with a family income of up to ₹8 lakh, not availing other government scholarships, will receive a 3% interest subvention on loans up to ₹10 lakh during the moratorium period.

Targeted Beneficiaries: The scheme prioritizes government institution students pursuing technical and professional courses. It is expected to benefit over 7 lakh new students annually, with 1 lakh students receiving interest subvention.

Digital Platform for Streamlined Application Process

A unified portal, ‘PM-Vidyalaxmi’, will facilitate applications for loans and interest subvention, integrating with all banks and offering payments through e-vouchers and CBDC wallets.

Empowering India’s Youth for a Brighter Future

The scheme aligns with the government’s broader vision of making higher education accessible to talented youth, especially from poor and middle-class backgrounds. Union Education Minister Dharmendra Pradhan emphasized that PM-Vidyalaxmi will remove financial obstacles, empowering India’s “yuva shakti” to reach their full potential.

Here’s a concise table summarizing the key points from the PM-Vidyalaxmi scheme

Why in News	Key Points
PM-Vidyalaxmi Scheme Approved	Scheme approved by Union Cabinet on November 6, 2024.
Objective	Provides collateral-free, guarantor-free education loans to meritorious students.
Loan Coverage	Full tuition fees and other course-related expenses for students in top 860 Quality Higher Education Institutions (QHEIs).
Outlay	₹3,600 crore allocated for 2024-25 to 2030-31.
Eligibility	Students securing admission in top 860 QHEIs based on NIRF rankings.
Institutions Covered	Top 860 institutions, both government and private, ranked in the top 100 in NIRF (overall, category-specific, and domain-specific rankings).
Interest Subvention	3% interest subvention for loans up to ₹10 lakh during the moratorium period for students with a family income of up to ₹8 lakh.
Credit Guarantee	75% credit guarantee for loans up to ₹7.5 lakh in case of defaults.
Beneficiaries	Expected to benefit over 22 lakh students annually.
Digital Platform	Unified portal ‘PM-Vidyalaxmi’ for loan applications and interest subvention.
Implementation Timeline	2024-25 to 2030-31.