New Delhi: The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the PM-Vidyalaxmi scheme, which provides financial support to meritorious students in a mission mode.
The mechanism will facilitate and drive the extension of education loans to meritorious students who get admission in the nation’s top 860 quality higher educational institutions, covering more than 22 lakh students every year.
These students will be eligible to get collateral-free, guarantor-free loans from banks and financial institutions to cover the total tuition fees and other expenses related to the course.
According to the Cabinet, students with loan amounts up to Rs 7.5 lakh will also be eligible for a credit guarantee of 75 percent of outstanding default.
“This will give support to banks in making education loans available to students under the scheme,” it said.
In addition, during the moratorium period, 3 percent interest subvention for loans up to Rs 10 lakh will also be provided for students with an annual family income of up to Rs 8 lakh who are not eligible for benefits under any other government scholarship or interest subvention scheme.
“According to a Cabinet note, “interest subvention support will be given to one lakh students every year. Preference will be given to students who are from government institutions and have opted for technical/ professional courses. ”
An outlay of Rs 3,600 crore has been made from 2024-25 to 2030-31, and seven lakh fresh students are expected to benefit from this interest subvention during the period. This is in addition to the full interest subvention already being offered to students with up to Rs 4.5 lakh annual family income.
PM-Vidyalaxmi is another key initiative stemming from the National Education Policy, 2020, which recommended that financial assistance be made available to meritorious students through various measures in public and private higher education institutions (HEIs). PM-Vidyalaxmi, on which students will be able to apply for education loans and interest subventions through a simplified application process to be used by all banks. Interest subvention payments.
The scheme will apply to the nation’s top-quality higher educational institutions, as determined by the NIRF rankings—including all HEIs, government and private, that are ranked within the top 100 in NIRF in overall, category-specific, and domain-specific rankings; state government HEIs ranked in 101-200 in NIRF; and all central government-governed institutions.
The Department of Higher Education will have a unified portal “PM-Vidyalaxmi” on which students will be able to apply for the education loan as well as interest subvention, through a simplified application process to be used by all banks. Payment of interest subvention will be made through E-vouchers and Central Bank Digital Currency (CBDC) wallets.
–IANS
