The PM Vidyalaxmi Scheme is a groundbreaking initiative by the Indian government designed to make higher education affordable for students across the nation and aims to ensure that financial challenges do not obstruct any student’s path to higher education. Announced in the Union Budget 2024-25, this centrally sponsored scheme provides financial support for educational loans up to ₹10 lakh for pursuing higher education in India.
Approved by the Union Cabinet on November 6, 2024, the scheme targets meritorious students who have not been able to benefit from other government schemes. In this article, we will explore all aspects of the Vidyalaxmi Scheme, from its objectives and benefits to the eligibility criteria and application process.
Table of Contents
What is PM Vidyalaxmi Education Loan Scheme
PM Vidyalaxmi Education Loan Yojana is a financial aid program designed to help Indian students afford higher education and to make easier for students to get educational loans without needing collateral or a guarantor. It’s available for students who secure admission based on merit to top-ranked higher education institutions in India.
Under this scheme, students can apply for loans that cover tuition, living expenses, and other costs associated with their studies. The loans are processed through a digital platform to ensure transparency and ease. The government provides a 75% credit guarantee to banks for loans up to ₹7.5 lakh, making it more accessible for students to secure funding.
Additionally, for students from families with annual incomes up to ₹8 lakh, there’s a 3% interest relief on loans up to ₹10 lakh during the course and one year after completion. This initiative aims to ensure that financial difficulties do not prevent students from accessing quality education
Key Benefits
- Collateral-free loans for students up to ₹7.5 lakh.
- 3% interest relief for families earning up to ₹8 lakh annually.
- Loans cover tuition, accommodation, and related expenses.
Quick Overview of PM Vidyalasmi Yojana
| Key Highlights | Detail |
|---|---|
| Launch Date | November 2024 |
| Ministry | Ministry of Education |
| Target Institutions | Top 860 as per NIRF rankings |
| Financial Outlay | ₹3,600 crore for the period 2024 to 2031 |
| Loan Coverage | Up to ₹7.5 lakh with 75% credit guarantee |
Objectives
- Facilitate access to higher education for approximately 22 lakh students annually.
- Provide a 75% credit guarantee on loans to encourage banks to extend credit.
- Support students in pursuing education without the hindrance of financial constraints.
Eligibility
- Open to students admitted to top NIRF-ranked institutions.
- No income restrictions for applying; interest relief for lower incomes.
- Includes both private and government HEIs ranked within the top 100 and state HEIs ranked 101-200.
Required Documents
- Aadhaar card
- Bank account details
- Admission confirmation from the institution
- Identity proof documents
Features
- Loans are provided without collateral or a guarantor.
- Covers full educational expenses including tuition and living costs.
- Designed to be affordable with interest subventions for lower-income families.
Interest Rate
- Interest rates range from 8.1% to 18%, depending on the lending bank and the specific course fees.
- A 3% interest relief (Subvention) is provided during the moratorium period for eligible students.
Repayment Period
- Moratorium period allows repayment to start after course completion or employment.
- Flexible monthly payment options post-moratorium, as per lender terms.
Maximum Loan Amount
- For Studies in India: Up to ₹10 lakh, covering all educational expenses such as tuition and living costs.
- For Studies Abroad: Up to ₹20 lakh, addressing costs like tuition, travel, and living expenses.
How to Apply Online for the PM Vidya Lakshmi ?
- Register on the Vidya Lakshmi Portal.
- Fill the Common Educational Loan Application (CELAF).
- Search and apply to various banks based on your needs.
- Submit your application and track its status online.
Official Resources
FAQs
Who is eligible for the PM Vidyalaxmi Scheme?
Students who have secured admission in Quality Higher Education Institutions (QHEIs) based on NIRF rankings are eligible. There are no income restrictions for applying, but interest relief is available for families earning up to ₹8 lakh annually.
What is the main purpose of the PM Vidyalaxmi Scheme?
The scheme aims to provide financial assistance to meritorious students, ensuring that financial constraints do not hinder their ability to pursue higher education.
How much loan can I obtain under this scheme?
For domestic studies, students can apply for loans up to ₹10 lakh, while for studies abroad, the loan amount can extend up to ₹20 lakh.
Are collateral and guarantor required for loans?
Loans up to ₹7.5 lakh are provided without the need for collateral or a guarantor. For higher loan amounts, banks may require collateral or a guarantor.
What expenses are covered under the loan?
The loan covers tuition fees, hostel fees, accommodation, travel, and other related expenses for both domestic and international studies.