The Skill Loan Scheme started under the Ministry of Skill Development and Entrepreneurship in 2015 on the Vidya Kaushal portal. It is a financial initiative that provides loans to individuals pursuing skill development programs. It is designed to help students or working professionals cover the costs associated with short-term skill development courses, including those that enhance vocational, technical, or professional abilities.
Available for courses offered by training centers approved by government authorities, such as the National Skill Development Corporation (NSDC) in India.
Benefits of the Skill Loan Scheme
Benefits of the Revised Skill Loan Scheme:
- The maximum loan limit has been increased from ₹1.5 lakh to ₹7.5 lakh, providing greater financial support for skill development.
- Initially launched in 2015, the previous scheme saw limited adoption due to the lower loan cap.
- Announced in the Union Budget 2024-2025, the revamped scheme aims to support 25,000 students yearly.
- The updated scheme expands the pool of eligible lenders to include non-banking financial companies (NBFCs), NBFC-MFIs (micro-finance institutions), and small finance banks.
- Rate of Interest: Base rate (MCLR) plus an additional margin, typically up to 1.5%.
- Moratorium Period: Covers the entire course duration.
- Repayment Period: Ranges from 3 to 7 years, depending on the loan amount.
- Encourages skill acquisition for better employability.Reduces the financial burden for students and professionals.
Eligibility of Skill Loan Scheme
“Have you been admitted to any of the following categories?*
- Courses offered by Industrial Training Institutes (ITIs)
- Polytechnics
- Schools recognized by Central or State Education Boards
- Colleges affiliated with recognized universities
- Training programs conducted by partners accredited by the National Skill Development Corporation (NSDC), Sector Skill Councils, State Skill Missions, or State Skill Corporations”
Application Process of Skill Loan Scheme
- Online Registration: Interested candidates must register on the Vidya Kaushal portal.
- Documents Required: Submit necessary documents, including:
- Proof of identity
- Proof of address
- Proof of income (self or guardian, if applicable).
- Course Selection: After registration, choose your preferred sector, role, and training center.
- Counseling: Visit your chosen center for personalized counseling.
- Loan Request: If needed, initiate a loan request through the center.
- Loan Evaluation: Review loan offers, compare terms, and accept or reject based on your preference.
- Loan Disbursement: Upon confirmation, the loan amount is disbursed directly to the selected partner or training center.
Required Documents of Skill Loan Scheme
- Proof of identity
- Proof of address
- Proof of income (either from the applicant or their guardian, if applicable)
Summary: The Skill Loan Scheme offers loans up to ₹7.5 lakh for skill development courses with a 3–7 year repayment period. Applicants register online via the Vidya Kaushal portal, submit essential documents (ID, address, income proof), select a course, request a loan, and receive funds directly to the training center.
Reference: Government of India. (n.d.). Skill Loan Scheme – Application Process. MyScheme Portal. Retrieved from https://www.myscheme.gov.in/schemes/sl#application-process
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