PM-Vidyalaxmi: Over 1.12 lakh collateral-free education loans sanctioned worth Rs 15,634 crore

The Government of India has sanctioned 1,12,817 collateral-free and guarantor-free education loans through the PM-Vidyalaxmi since the scheme was launched on November 6, 2024 till July 21, 2026. Loans worth Rs 15,634.78 crore have been approved during the period.

According to the PIB report, the PM-Vidyalaxmi scheme aims to ensure that no student is denied the opportunity to pursue higher education due to financial constraints. Under the scheme, students securing merit-based admission in top quality higher education institutions (QHEIs) can avail collateral-free and guarantor-free education loans.

The government also announced that students taking education loans of up to Rs 10 lakh will get a 3% interest subvention on loans if the family income is up to Rs 8 lakh a year. The benefit can be availed by as many as one lakh of fresh students who are not eligible for any other scholarship or interest subsidy every year. An outlay of Rs 3,600 crore has been earmarked from 2024-25 to 2030-31 for the scheme.

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Portal simplifies education loan application

The dedicated PM-Vidyalaxmi portal was launched on February 25, 2025 for the students to apply for education loan and interest subvention with a streamlined application process accepted by all banks.

As per PIB report, Aadhaar based de-duplication is done so that only eligible students can avail the interest subsidy. The students are given an SMS to download the PM-Vidyalaxmi digital rupee app once the application has been approved. Once the banks have submitted the claims, the interest subvention amount is credited to the digital wallet of the student which is then transferred to the education loan account via direct benefit transfer (DBT).

Credit guarantee increased, bank support expanded

According to the PIB report, the department of higher education is also rolling out the PM uchchatar shiksha protsahan credit guarantee fund scheme for education loans (PM-USP CGFSEL). The scheme was launched by the central government in the event of default of the loan, the government would guarantee 75% of the loan amount, while the remaining 25% would be covered by the lender.

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Till July 21, 2026, 14,65,880 credit guarantees worth Rs 59,843.74 crore have been issued since the launch of the scheme in 2015. The government stated that the 12 public sector banks, 20 private banks, 25 regional rural banks and 7 cooperative banks have been getting onboarded on the PM-Vidyalaxmi portal.