On Wednesday the Cabinet approved the PM Vidyalaxmi scheme providing monetary support to meritorious students. The scheme has been introduced to provide students with financial constraints with necessary financial help which will help them pursue quality higher education.
Union Minister Ashwini Vaishnaw stated that anybody who gets admission to quality higher education institutions will be eligible for a collateral-free guarantor-free loan from banks and financial institutions to cover the full tuition fee and other expenses related to the programme they are enrolled in.
Loan Amount and Other Benefits
As per details available, a total of Rs. 3600 crore has been approved for the scheme under which educational loans will be provided to students securing admissions to the top 860 higher education institutions in the country as per their NIRF ranking. The amount is estimated to cover over 22 lakh students every year.
The scheme will be applicable to top higher education institutions as determined by NIRF rankings including government and private institutions which are ranked within the top 100 in NIRF all over, category-specific and domain-specific rankings. The state government higher education institutions ranked between 101-200 in NIRF and all central government-run institutions will also fall in this list.
As per an official statement issued the list will be updated every year using the latest NIRF ranking and begin with 860 qualifying institutions covering more than 22 lakh students to be able to potentially avail the benefits of the scheme.
According to the scheme for loan amounts of up to Rs. 7.5 lakh students will also be eligible for a credit guarantee of 75pc of outstanding default. This is being introduced to provide support to banks in making education loans available to students.
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Students with an annual family income of up to Rs. 8 lakh and not eligible for benefits under any other government scholarships a 3% interest subsidy for loans up to Rs. 10 lakh will be provided.
The interest subsidy support will be given to 1 lakh students every year and preference will be given to students from government institutions who have opted for technical and professional courses.
A portal - PM-Vidyalaxmi will be created where students can apply for education loans as well as interest subsidies through a simplified application process to be used by all banks. The payment of interest subsidy will be made via e-vouchers and Central Bank Digital Currency wallets.
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