The Union Cabinet has approved the PM Vidyalaxmi scheme, aiming to assist middle-class students facing financial challenges in pursuing higher education. This initiative ensures that students admitted to accredited institutions can access collateral-free and guarantor-free education loans. Union Information Minister Ashwini Vaishnaw stated, “Such loans will be collateral-free and guarantor-free.”
Key Features of the PM Vidyalaxmi Scheme:
Eligibility and Coverage: Students admitted to top-ranking institutions are eligible. The scheme targets to benefit up to 100,000 students annually.
Interest Subvention: Students with an annual family income up to Rs 8 lakh can avail a 3% interest subsidy on education loans up to Rs 10 lakh. This is in addition to the full interest subsidy already offered to students with an annual family income up to Rs 4.5 lakh.
Institutional Inclusion: The Department of Higher Education will annually curate a list of high-quality institutions, including:
- Top 100 ranked institutes in the overall, category-specific, and domain-specific rankings in the National Institutional Ranking Framework (NIRF).
- Top 200 ranked Higher Education Institutions (HEIs) of State/UT Governments in NIRF.
- All remaining HEIs under the Government of India.
Loan Processing: Applications will be managed through the PM Vidyalaxmi portal, ensuring a streamlined process for approval, monitoring, and disbursal.
Credit Guarantee: Loans up to Rs 7.5 lakh will have a 75% credit guarantee on outstanding defaults, encouraging financial institutions to extend loans to a broader student base.
Digital Integration: The PM Vidyalaxmi portal offers a unified platform for students to apply for loans and track their application status, enhancing transparency and efficiency.
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Alignment with Existing Initiatives: This scheme complements the existing Vidya Lakshmi portal, which provides information on various education loan schemes and scholarships. The integration aims to simplify the financial aid process for students.
