Higher education is a dream for many students in India. But sometimes, lack of money becomes a problem. To help such students, the Indian government started the Pradhan Mantri Education Loan Scheme, also known as the Pradhan Mantri Vidya Lakshmi Scheme. It helps students get easy loans for their studies without much stress.
This blog will explain what is Pradhan Mantri Education loan scheme, who can apply, how to apply, how much loan you can get, and how to repay it in very simple words.
Also Read: Government Education Loan for Students to Study Abroad
📘 What is Pradhan Mantri Education Loan Scheme?
This is a government-supported scheme that provides education loans to students who want to study further after class 12. The main goal is to support students from poor and middle-class families so that money doesn’t stop them from achieving their dreams.
The scheme works through an online platform called the Vidya Lakshmi Portal, where students can apply for education loans from multiple banks using one single form.
🎯 Main Objectives of the Scheme
- Help students get easy education loans.
- Make the loan process simple and online.
- Provide government support for students from low-income families.
- Make higher education possible for all.
📝 Features of the Scheme
| Feature | Details |
| Scheme Name | Pradhan Mantri Vidya Lakshmi Scheme |
| Started By | Government of India (in 2015) |
| Platform | www.vidyalakshmi.co.in |
| Number of Banks | 35+ banks (like SBI, PNB, BoB, etc.) |
| Loan Amount | Up to ₹7.5 lakh without collateral, higher with security |
| Interest Subsidy | For families with income up to ₹4.5 lakh/year (full subsidy) |
| Courses Covered | Graduate, Postgraduate, Professional, Technical |
| Mode of Application | Online through Vidya Lakshmi Portal |
| Repayment Time | Up to 15 years (after course + 1 year grace period) |
👩🏫 Who Can Apply?
- Indian citizens.
- Students who have secured admission in recognized colleges in India or abroad.
- Students from economically weaker sections (EWS), especially if family income is less than ₹4.5 lakh per year.
- Must have marks-based admission (merit-based or entrance exam).
🎓 Courses Covered
- Engineering
- Medical
- Management (MBA)
- Law
- Polytechnic
- Nursing
- Graduation and Post-Graduation in Arts, Commerce, Science
- Technical and Professional courses in India or abroad
💵 How Much Loan Can a Student Get?
The amount of loan depends on the course, fees, and bank policies.
| Course Type | Maximum Loan Amount | Collateral Required? |
| In India | Up to ₹10 lakh | No (up to ₹7.5 lakh) |
| Abroad | Up to ₹20 lakh | Yes (above ₹7.5 lakh) |
👉 No margin money required for loans up to ₹4 lakh. For loans above ₹4 lakh, 5–15% margin may apply.
💰 Interest Rates (Easy Calculation)
Different banks charge different interest rates, usually around 7% to 10% per year. Here’s a simple example:
🧮 Loan Example
- Loan: ₹5,00,000
- Interest rate: 8% per year
- Course duration: 4 years
- Moratorium: 1 year after course ends
- Repayment starts after 5 years
Simple interest for 5 years =
₹5,00,000 × 8% × 5 = ₹2,00,000
So, total amount to be repaid = ₹5,00,000 + ₹2,00,000 = ₹7,00,000
Now, this ₹7,00,000 can be paid in EMIs for up to 15 years.
🧾 What is Interest Subsidy?
The Central Government pays the interest during the study period + 1 year after the course, but only for:
- Students with family income ≤ ₹4.5 lakh/year
- Studying in professional or technical courses
- Loans taken from scheduled banks under Indian Banks’ Association (IBA) model
This is called the Central Sector Interest Subsidy Scheme (CSIS).
🖥️ How to Apply Online?
- Visit www.vidyalakshmi.co.in
- Register with basic details.
- Fill the Common Education Loan Application Form (CELAF).
- Choose maximum 3 banks to apply to at once.
- Submit the form.
- Banks will contact you after review.
You can also track the application status and submit complaints through the portal.
🏦 Which Banks Are Part of This Scheme?
- State Bank of India (SBI)
- Punjab National Bank (PNB)
- Bank of Baroda (BoB)
- Canara Bank
- Union Bank
- HDFC Bank
- ICICI Bank
… and many more (35+ banks)
📆 Repayment Schedule
- Start repayment: After course + 1-year moratorium
- Tenure: Up to 15 years
- Mode: EMI (monthly installment)
💡 Tip: Some banks allow early repayment without extra charges.
✅ Benefits of the Scheme
- Apply to multiple banks in one go.
- Safe and secure online process.
- Government pays interest for poor students.
- No need for security or guarantor up to ₹7.5 lakh.
- Long repayment period with easy EMIs.
⚠️ Things to Remember
- Keep documents ready: Aadhaar, PAN, income proof, admission letter, fee structure.
- Apply at least 1-2 months before the academic session starts.
- Compare loan terms from different banks.
📝 Conclusion
The Pradhan Mantri Education Loan Scheme is a great step towards making higher education accessible for all. With easy loans, no collateral (up to ₹7.5 lakh), and government interest support, students from all backgrounds can now chase their dreams without worrying about money.