The initiative offers collateral-free education loans to students securing merit-based admission to top higher education institutions
More than 1.12 lakh students have received collateral-free and guarantor-free education loans under the PM-Vidyalaxmi scheme since its launch in November 2024, the Ministry of Education recently informed the Lok Sabha.
In a written reply, Minister of State for Education Sukanta Majumdar said that 1,12,817 education loans amounting to Rs 15,634.78 crore have been sanctioned under the scheme so far. The initiative aims to ensure that eligible students do not have to forgo higher education because of financial constraints by providing collateral-free education loans to those who secure merit-based admission to top higher education institutions.
Students with an annual family income of up to Rs 8 lakh are also eligible for a 3% interest subsidy on education loans of up to Rs 10 lakh. The government has earmarked Rs 3,600 crore for the scheme between 2024-25 and 2030-31, with the objective of supporting up to seven lakh fresh students during the period.
The ministry said the PM-Vidyalaxmi portal, operational since 25 February 2025, enables students to apply for education loans and interest subsidies through a single online platform integrated with participating banks.
The government also shared details of the PM Uchchatar Shiksha Protsahan Credit Guarantee Fund Scheme for Education Loans (PM-USP CGFSEL). Since its launch in 2015, the scheme has issued 14,65,880 credit guarantees covering education loans worth Rs 59,843.74 crore. It provides a government guarantee of up to 75% for eligible education loans of up to Rs 7.5 lakh without requiring collateral.
To ensure that benefits reach eligible students, the ministry said Aadhaar-based verification is used to prevent duplicate claims. The interest subsidy is transferred directly to students' education loan accounts through Direct Benefit Transfer (DBT) after verification. From the second year onwards, students must maintain satisfactory academic performance, while their institutions are required to upload semester-wise progress reports on the portal.
According to the ministry, 64 banks have joined the PM-Vidyalaxmi portal so far. These include 12 public sector banks, 20 private banks, 25 regional rural banks and seven co-operative banks, making education loans more accessible to students across the country.
