The Union Cabinet chaired by the Prime Minister approved a new Central Sector scheme, PM Vidya Laxmi for Higher Education support.

About PM Vidya Lakshmi Scheme

• Objective: To provide financial support to meritorious students for pursuing higher education by offering easy access to loans.
  • The scheme builds on the foundation set by the National Education Policy (NEP) 2020.

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• Eligibility: Students admitted to top 860 Quality Higher Education Institutions (QHEIs) in India, including top-ranked institutions in National Institutional Ranking Framework (NIRF) and select State and Central government HEIs.
• Digital and transparent process: The scheme will be administered via a dedicated PM-Vidyalaxmi portal, providing a fully digital application system.
  • Payment of interest subvention will be made through E-voucher and Central Bank Digital Currency (CBDC) wallets
• Loan Features:
  • Collateral-Free Loans: Students can avail loans without collateral or guarantors to cover full tuition and course-related expenses.
  • Credit Guarantee: Loans up to ₹7.5 lakh have a 75% credit guarantee, encouraging banks to extend loans.
  • Interest Subvention: For students from families with an annual income up to ₹8 lakh, a 3% interest subsidy on loans up to ₹10 lakh during the moratorium period.
  • Preference for technical/professional courses in government institutions.
• Beneficiaries: Aimed at benefiting around 22 lakh students, with 1 lakh students receiving interest support annually.
• Budget: An outlay of ₹3,600 crore for 2024-25 to 2030-31, targeting 7 lakh new students under the interest subvention program over this period.