The Union Cabinet on Wednesday approved the PM-Vidyalaxmi scheme to provide monetary support to meritorious students in the form of education loans in both public and private institutions.

       Under the scheme, any meritorious student who gets admission to quality higher educational institutions will be eligible for a collateral-free and guarantor-free loan from banks and financial institutions.

       The loans will cover the full tuition fees and other expenses related to the course.

       According to a government communication, an outlay of Rs 3,600 crore has been set aside for 2024-25 to 2030-31. The scheme is expected to cover over 2.2 million students who can potentially avail PM-Vidyalaxmi benefits every year.

       “The Cabinet has approved the PM-Vidyalaxmi scheme to provide financial support to meritorious students so that financial constraints do not prevent any youth of India from pursuing quality higher education,” Union Information and Broadcasting Minister Ashwini Vaishnaw said at a press conference.

       Under the scheme, loan amounts of up to Rs 7.5 lakh will be provided at a 75 per cent credit guarantee by the central government. It will support banks to expand coverage under the scheme.

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       The payments of interest subvention will be made through e-voucher and Central Bank Digital Currency (CBDC) wallets.

       Furthermore, for students having an annual family income up to Rs 8 lakh, the scheme will offer a 3 per cent interest subvention on loans up to Rs 10 lakh. The subvention support will be offered to 100,000 students every year.

       “Both government and private banks and financial institutions will be able to participate in PM-Vidyalaxmi,” Vaishnaw said.

       The scheme will be implemented via a unified government portal, through which students who get admission to quality institutes can apply for education loans and interest subvention.

       The list of institutes eligible under the scheme will be updated every year using the latest National Institutional Ranking Framework (NIRF), with 860 institutes qualifying to begin with.

       The criteria of institutes covered under the scheme include those determined by the NIRF as the top 100 in overall, category-specific and domain-specific rankings.

       The scheme will also extend to state government-run institutes ranked between 101 and 200 in the NIRF and higher educational institutions of the central government.

       The scheme aims to supplement the Central Sector Interest Subsidy (CSIS) and Credit Guarantee Fund Scheme for Education Loans (CGFSEL), the two components of the PM-USP scheme being implemented by the Department of Higher Education. The Blueprint

       Rs 3,600 crore outlined till 2030-31, to provide financial assistance to students pursuing higher education

       Up to Rs 7.5 lakh loan will be provided a 75% credit guarantee by the central government

       Students having annual family income up to Rs 8 lakh, will get a 3% interest subvention on loans up to Rs 10 lakh

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