Nowadays, pursuing higher education is very important, but often due to lack of money, many students are unable to fulfill their dreams. But now the government has come up with a special scheme – Pradhan Mantri Vidyalaxmi (PM-Vidyalaxmi) Scheme! This scheme was approved on November 6, 2024 and now it will help more than 22 lakh students in India to pursue higher education every year. Let’s get detailed information about this scheme and understand how this scheme can help you.
What is the purpose of PM-Vidyalaxmi Scheme?
The main purpose of this scheme is that no meritorious student should be deprived of higher education due to lack of money. This scheme is to provide education loans of up to Rs 10 lakh to students who have got admission in the top 860 Higher Education Institutions (QHEIs) in India. The special thing is that this loan will be available without any collateral (Collateral-Free) and without a guarantor (Guarantor-Free), and it will have a simple, transparent and digital process.
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A look at the key features of the scheme
- Applicable to which institutions?
– The scheme is applicable to the top 860 QHEIs in India. These include:
– Top 100 institutions in NIRF rankings (general, category-specific and domain-specific).
– State government institutions ranked 101 to 200 in NIRF.
– All central government institutions. - Loan amount and interest subsidy
– Loan up to Rs 10 lakhs will be available, which can be used for course fees, hostel, mess, laptop and other expenses.
– The government will provide 75% credit guarantee on loans up to Rs 7.5 lakhs, which will incentivize banks to lend.
– Students with annual family income up to Rs 8 lakhs will get 3% interest subsidy on loans up to Rs 10 lakhs (during the moratorium period).
– Students with income up to Rs 4.5 lakh will get 100% interest subvention (under PM-USP CSIS scheme). - Who is eligible?
– Any student who has got admission on merit (competitive examination or merit-based) in QHEIs in India.
– Students who have got admission through management quota are not eligible.
– Students from all family income groups can apply for the loan. - Digital process
– One can apply for the loan by filling just a 2-page application form on the PM-Vidyalaxmi portal.
– The entire process will be digital and transparent.
What is the eligibility for interest subvention?
The following are the criteria for interest subvention under the scheme. I have prepared a simple chart to make it easy for you to understand:
| Family Income | Course Type | Interest Subvention | Scheme |
|---|---|---|---|
| Up to ₹4.5 Lakh | Technical/Professional | 100% Interest Subvention | PM-USP CSIS |
| Up to ₹4.5 Lakh | Other Courses (Degree/Diploma) | 3% Interest Subvention | PM-Vidyalaxmi |
| ₹4.5 Lakh to ₹8 Lakh | All Courses (Technical/Other) | 3% Interest Subvention | PM-Vidyalaxmi |
Important: Only 1 lakh students will get 3% interest subsidy. There will be a selection process for this, in which priority will be given to students studying in government institutions, those pursuing technical courses, those who have passed 12th/10th from government schools, those who have studied in rural schools and girls.
Loan Repayment and Moratorium Period
- Moratorium Period: Course duration + 1 year. During this period, the student does not need to pay installments.
- Repayment Period: Loan can be repaid up to 15 years after the moratorium period.
- Interest rate: Interest will not be charged more than the bank’s EBLR (Externally Benchmarked Lending Rate) + 0.5%.
- Example: Suppose you take a loan of Rs 30 lakh for a 2-year course and disburse Rs 16 lakh in the first year. The bank charges 8.5% interest, so the interest will be Rs 1.36 lakh in the first year. This will give you a 3% interest subsidy on Rs 10 lakh, which means the government will pay Rs 30,000, and you will have to pay Rs 1.06 lakh.
How to apply?
PM-Vidyalaxmi Scheme Portal: You can apply for a loan on this portal. PM Vidyalaxmi Portal
Documents: Aadhaar, PAN card, marksheet, admit card, fee structure, income proof (from an authorized authority of the state government).
Process: After applying, the bank will approve the loan and disburse the money. You will have to apply separately on the portal for interest subsidy.
Few Important Things!
- Beware of fraud: If you provide incorrect information (e.g. income is high but shown less), then you will have to return the interest subsidy and legal action may be taken.
- De-duplication with other schemes: If you are availing any other government scholarship or interest subsidy, you will not get the benefit of this scheme. Aadhaar-based verification will be done for this.
- Academic performance: To get interest subsidy from the second year onwards, you will have to pass the course with good marks.
My opinion
This scheme is really a boon for meritorious students. It will especially benefit middle class families a lot. But I think the limit of 1 lakh students should be increased a little, because there are many needy students in India. If you have got admission in QHEI, then this scheme is for you! Go to PM-Vidyalaxmi portal today and apply. If you have any doubts, ask me, I will explain in simple language!
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FAQ:
1. What is the PM-Vidyalaxmi Scheme?
PM-Vidyalaxmi is a scheme offering up to ₹10L collateral-free education loans for students in India’s top 860 QHEIs, with 3% interest subvention for family income up to ₹8L.
2. Who is eligible for PM-Vidyalaxmi education loans?
Students admitted on merit to India’s top 860 QHEIs for degree/diploma courses, excluding management quota admissions, can apply regardless of family income.
3. How does the 3% interest subvention work in PM-Vidyalaxmi?
For loans up to ₹10L, students with family income up to ₹8L get 3% interest subvention during the moratorium period (course duration + 1 year), limited to 1 lakh beneficiaries.
4. Which institutions qualify under PM-Vidyalaxmi?
Top 100 NIRF-ranked HEIs, top 200 state-governed HEIs in NIRF, and all central government HEIs—totaling 860 institutions—are eligible for the scheme.
5. How do I apply for a PM-Vidyalaxmi loan?
Apply through the PM-Vidyalaxmi portal with a 2-page form, submit KYC, mark sheets, admission letter, fee structure, and income proof for interest subvention.