Daily Current Affairs : 21-November-2024
On November 6, 2024, the Union Cabinet approved the PM Vidyalaxmi scheme, a central initiative aimed at providing financial support to meritorious students pursuing higher education. This scheme offers loans to cover tuition fees and other related expenses, making quality education more accessible for deserving students. The loans are collateral-free, and there is no need for a guarantor, making it easier for students from diverse backgrounds to avail of the scheme.
Key Features of the PM Vidyalaxmi Scheme
- Objective: The primary goal of the PM Vidyalaxmi scheme is to help talented students overcome financial barriers in accessing quality higher education.
- Eligibility: This scheme is available to students admitted to the top 860 higher education institutions (HEIs) in India, as ranked by the National Institutional Ranking Framework (NIRF). Annually, over 22 lakh students are expected to benefit from this initiative.
- Loan Features: The scheme offers collateral-free and guarantor-free loans, ensuring that students do not face the usual hurdles in securing financial aid. The application process is fully digital, making it simple and user-friendly.
- Credit Guarantee: The government provides a 75% credit guarantee on loans up to ₹7.5 lakhs, which helps banks extend loans more freely.
- Interest Subvention:
- For students from families with an annual income up to ₹8 lakhs, there is a 3% interest subvention on loans up to ₹10 lakhs.
- Families with an income of up to ₹4.5 lakhs can avail of full interest subvention under the PM-USP scheme.
Complementary Support
The PM Vidyalaxmi scheme works alongside other existing initiatives such as the Central Sector Interest Subsidy (CSIS) scheme and the Credit Guarantee Fund for Education Loans (CGFSEL) under the PM-USP scheme. These schemes ensure comprehensive support for students pursuing technical and professional courses in recognized institutions.
How PM Vidyalaxmi Differs from Other Schemes
- Broader Income Coverage: Unlike earlier schemes, which mainly focused on low-income groups, the PM Vidyalaxmi scheme extends benefits to middle-income families as well, with an income cap of ₹8 lakh.
- Interest Subvention: A key feature is the 3% interest subvention offered during the moratorium period for loans up to ₹10 lakh. This will benefit around 1 lakh students each year.
- Institution Eligibility: The scheme targets only top-ranked institutions as per the NIRF, rather than focusing on those accredited by NAAC and NBA.
- Simplified Loan Process: The use of the Vidyalaxmi portal ensures that loan applications, tracking, and disbursements are easier and more efficient.
- Focus on Quality: The scheme prioritizes quality by offering support exclusively to the top 860 NIRF-ranked institutions, ensuring that students get the best possible education.
Outlay and Reach
The PM Vidyalaxmi scheme has a substantial budget allocation of ₹3,600 crore for the period 2024-2031. With this, the scheme aims to benefit 22 lakh students, making higher education more accessible and affordable for a larger number of students across India.
Important Points:
- PM Vidyalaxmi Scheme Overview:
- Approved by the Union Cabinet on November 6, 2024.
- Aimed at providing financial support for meritorious students pursuing higher education.
- Offers collateral-free and guarantor-free loans for tuition fees and related expenses.
- Key Features:
- Objective: To remove financial barriers for deserving students in accessing quality education.
- Eligibility: Available for students admitted to the top 860 NIRF-ranked higher education institutions (HEIs) in India.
- Loan Process: Fully digital and user-friendly application process.
- Credit Guarantee: 75% credit guarantee on loans up to ₹7.5 lakhs to help banks.
- Interest Subvention:
- 3% subvention on loans up to ₹10 lakh for families with income up to ₹8 lakh.
- Full interest subvention for families earning up to ₹4.5 lakh under PM-USP.
- Complementary Schemes:
- Works alongside existing initiatives like CSIS and CGFSEL to support students in technical and professional courses.
- Distinct Features of PM Vidyalaxmi:
- Broader Income Coverage: Extends benefits to middle-income families (income cap ₹8 lakh).
- Interest Subvention: 3% subvention on loans up to ₹10 lakh, benefiting 1 lakh students annually.
- Institution Eligibility: Targets only top NIRF-ranked institutions, unlike previous schemes focused on NAAC/NBA-accredited institutions.
- Simplified Process: Loan applications, tracking, and disbursements are managed via the Vidyalaxmi portal.
- Financial Outlay and Reach:
- ₹3,600 crore allocated for the period 2024-2031.
- Aims to benefit 22 lakh students annually.
Why In News
On November 6, 2024, the Union Cabinet approved PM Vidyalaxmi, a Central Sector Scheme aimed at providing financial support to meritorious students pursuing higher education. This initiative is designed to address the financial challenges faced by students from diverse backgrounds, ensuring that they have the opportunity to access quality education without the burden of high costs.
MCQs about PM Vidyalaxmi Scheme
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What is the primary objective of the PM Vidyalaxmi scheme?
A. To provide loans only for students in technical courses
B. To offer financial support to meritorious students for higher education
C. To provide scholarships for students from low-income families
D. To fund research projects in universities
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Which of the following features distinguishes the PM Vidyalaxmi scheme from previous loan schemes?
A. It focuses only on technical courses
B. It offers collateral-free loans with a simplified digital process
C. It only applies to students from low-income families
D. It is available only for students in government colleges
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How much credit guarantee does the government provide under the PM Vidyalaxmi scheme?
A. 50% credit guarantee on all loans
B. 75% credit guarantee on loans up to ₹7.5 lakhs
C. 100% credit guarantee on loans up to ₹5 lakhs
D. 25% credit guarantee on loans up to ₹10 lakhs
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Which type of institutions are eligible for the PM Vidyalaxmi scheme?
A. Only NAAC-accredited institutions
B. Only private universities
C. Top 860 NIRF-ranked institutions
D. Only government-funded colleges
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