IIM Mumbai lauds government landmark initiative PM Vidyalaxmi Scheme

Mumbai, November 7, 2024: The Union Cabinet has approved the PM-Vidyalaxmi Scheme, a landmark initiative aimed at providing collateral-free and guarantor-free loans to financially constrained students seeking to pursue higher education. With an estimated Rs. 3600 crore allocation for the period from 2024-2025 to 2030-31, the scheme is designed to support 2.2 million students annually by offering loans of up to Rs. 7.5 lakh at concessional interest rates.

“This initiative is a major step in making higher education more inclusive and accessible for all students, particularly those from economically disadvantaged backgrounds. We applaud Prime Minister Modiji’s vision to create a skilled, educated workforce that will drive growth and create a better future for the youth of this country.,” said Prof. Manoj Tiwari, Director, IIM Mumbai.

The scheme is targeted at students from families with an annual income of up to Rs. 8 lakh, offering a 3% interest subvention on loans up to Rs. 10 lakh. This will benefit around 100,000 students every year, enabling them to access higher education without the burden of high-interest rates, collateral, or a guarantor. The scheme covers 860 institutions across India, including both public and private universities listed in the NIRF rankings.

By breaking down financial barriers, the PM-Vidyalaxmi Scheme aims to reduce the dropout rate, currently at 38%, due to financial constraints, and ensure that talented students from underserved communities can pursue their academic dreams. The loans will be repaid after students secure employment, creating a sustainable revolving fund that will support future students and contribute to the nation’s economic growth.

The PM-Vidyalaxmi Scheme is set to play a transformative role in shaping the future of India’s education system, fostering social equity, and driving national development.