SL
Skill Loan Scheme
7.0/10A Skill loan scheme by Ministry of Skill Development and Entrepreneurship to provide loan upto Rs. 1,50,000 to student who has secured admission in a course run by Industrial Training Institutes (ITIs), Polytechnics or in a school recognized by Central or State education Boards or in a college affil
States / UT: All India
Ministry / nodal: Ministry Of Skill Development And Entrepreneurship
Scheme for: Individual
Scheme profile
DBT (direct benefit transfer): No
Scheme open date: 2015-07-15
Categories: Skills & Employment, Banking,Financial Services and Insurance
Sub-categories: Loan, Training and Skill Up-gradation
Target beneficiaries: Individual
Tags: Skill Development, Student, Industrial Training Institutes (ITIs), Polytechnics
Details
The Skill Loan Scheme was launched in July 2015 to provide institutional credit to individuals for skill development courses aligned to National Occupations Standards and Qualification Packs and leading to a certificate/diploma/degree by training institutes as per National Skill Qualification Framework (NSQF).
This scheme is applicable to all member banks of the Indian Banks’ Association (IBA) and any other banks and financial institutions as may be advised by the RBI. The scheme provides broad guidelines to the banks for operationalizing the skilling loan scheme.
Salient features of the guidelines to banks for operationalizing the scheme:
- Eligibility –Any individual who has secured admission in a course run by Industrial Training Institutes (ITIs), Polytechnics or in a school recognized by Central or State education Boards or in a college affiliated to a recognized university, training partners affiliated to National Skill Development Corporation (NSDC) / Sector Skill Councils, State Skill Mission, State Skill Corporation
- Courses – Aligned to NSQF
- Quantum of Finance – Rs 5000-1,50,000
- Duration of Course – No minimum duration
- Rate of Interest – Base rate (MCLR) + an add on typically up to 1.5%
- Moratorium – Duration of the course
- Repayment Period – Between 3 to 7 years basis the amount of loan
- Loans upto ₹ 50,000 - Upto 3 years
- Loans between ₹ 50,000 to ₹1 lakh - Upto 5 years
- Loans above ₹1 lakh - Upto 7 years
- Coverage – Course Fees (directly to the training institute) along with expenses towards completion of the course (assessment, examination, study material, etc.)
- The scheme does not allow for a collateral to be charged from the beneficiary.
- MSDE, through a November 2015 notification, brought into force the Credit Guarantee Fund for Skill Development (CGFSSD) for all skill loans sanctioned on or after 15 July 2015, to be administered by the National Credit Guarantee Trust Company (NCGTC).
- Banks can apply to the NCGTC for credit guarantee against defaults and NCGTC will provide this guarantee at nominal fee which shall not exceed 0.5% of the amount outstanding. The guarantee cover will be for a maximum of 75% of the outstanding loan amount (including interest, if any).
- As per the information provided by Indian Bank’s Association (IBA) in respect of 21 Banks, a total skill loan of Rs 29.06 crore was disbursed during the year 2018-19 (as on September 2018).
Benefits
- [ { "type": "heading four"
- "children": [ { "text": "Courses " } ] }
- { "children": [ { "text": "Aligned to NSQF" } ] }
- { "children": [ { "text": "" } ] }
- { "type": "heading four"
- "children": [ { "text": "Quantum of Finance" } ] }
- { "children": [ { "text": " Rs 5000-1 50 000" } ] }
- { "children": [ { "text": "" } ] }
- { "type": "heading four"
- "children": [ { "text": "Duration of Course " } ] }
- { "children": [ { "text": "No minimum duration" } ] }
Courses
Aligned to NSQF
Quantum of Finance
Rs 5000-1,50,000
Duration of Course
No minimum duration
Rate of Interest
Base rate (MCLR) + an add on typically up to 1.5%
Moratorium
Duration of the course
Repayment Period
Between 3 to 7 years basis the amount of loan
Loan
Loans upto ₹ 50,000 - Upto 3 years
Loans between ₹ 50,000 to ₹1 lakh - Upto 5 years
Loans above ₹1 lakh - Upto 7 years
Coverage
Course Fees (directly to the training institute) along with expenses towards completion of the course (assessment, examination, study material, etc.)
The scheme does not allow for a collateral to be charged from the beneficiary.
MSDE, through a November 2015 notification, brought into force the Credit Guarantee Fund for Skill Development (CGFSSD) for all skill loans sanctioned on or after 15 July 2015, to be administered by the National Credit Guarantee Trust Company (NCGTC).
Banks can apply to the NCGTC for credit guarantee against defaults and NCGTC will provide this guarantee at nominal fee which shall not exceed 0.5% of the amount outstanding. The guarantee cover will be for a maximum of 75% of the outstanding loan amount (including interest, if any).
Eligibility
A student who has secured admission in a course run by Industrial Training Institutes (ITIs), Polytechnics or in a school recognized by Central or State education Boards or in a college affiliated to a recognized university, training partners affiliated to National Skill Development Corporation (NSDC) / Sector Skill Councils, State Skill Mission, State Skill Corporation
How useful is this scheme?
A practical look at this scheme for citizens
AI-generated insights showing how useful, accessible, and practical this scheme may be — combining deterministic scoring rules with a public-policy LLM analyst.
- Accessibility6.0
- Financial impact9.0
- Rural utility5.0
- Awareness7.5
- Simplicity7.0
- Inclusivity7.0
What problem does this scheme solve?
The Skill Loan Scheme provides financial support for skill development, benefiting students seeking vocational training.
Key challenges addressed
- Access to financial resources for skill development courses.
Most beneficial for
- Students enrolled in vocational training programs.
Likely challenges
- Complex application process for first-time applicants.
- Potential lack of awareness among rural populations.
Practical insights for citizens
The scheme is practical but may require additional support for rural applicants.
Rural challenges
- Limited access to online resources.
- Lack of awareness about the scheme.
Digital challenges
- Dependence on internet access for application.
- Potential issues with digital literacy.
Implementation bottlenecks
- Complexity in loan approval process.
Awareness challenges
- Low awareness in rural areas.
Application analysis
- Application mode
- Online portal
- Documents burden
- Moderate, requires proof of identity, address, and income.
- Verification complexity
- Moderate, involves multiple steps.
- Office dependency
- Low, primarily online.
- DBT dependency
- No direct benefit transfer involved.
- CSC support
- Available through local centers.
- Estimated citizen effort
- Moderate, requires registration and loan request process.
Estimated beneficiary reach
Benefit analysis
- Benefit type
- Cash
- Benefit frequency
- One-time loan disbursement.
- Benefit practicality
- High, as it covers course fees and related expenses.
- Financial meaningfulness
- High, with loans up to ₹150,000.
- Long-term impact
- Positive, as it promotes skill development and employability.
Plain-language guidance
The Skill Loan Scheme helps students get loans for vocational training courses. It is designed for those who want to enhance their skills and improve job prospects.
- Who should apply
- Students who have secured admission in skill development courses.
- Who may struggle
- First-time applicants and those with limited digital skills.
- Best application route
- Apply via the Vidya Kaushal portal or local CSC.
This intelligence section is generated by an AI policy analyst combined with rule-based scoring. Scores and narrative are estimates derived from the publicly available scheme information shown on this page; actual experience may vary by state, district, and department. Always confirm details on the official portal before you apply.
Application Process
Online
Interested candidates need to register on the Vidya Kaushal portal
Documents required– including, but not limited to proof of identity, proof of address, proof of income (of self or guardian, if available)
Post successful registration, candidate can select their preferred sector/ role/ centre
Visit the centre of your choice for counselling
Raise loan request through the centre, if required
Evaluate and accept/ reject loan offers based on preference
Disbursement of the loan directly to partner/ centre post-confirmation
Clarifications
Additional points from the scheme information published on myScheme (not legal advice).
- What is the maximum loan one can avail in the scheme?
Student satisfying the eligibility can avail the loan amount upto Rs. 1,50,000 .
- What is MCLR under rate of interest?
Marginal Cost of Lending Rate (MCLR) is the minimum lending rate below which a bank is not permitted to lend.It varies from bank to bank.
- What is moratorium period?
A moratorium period refers to a particular period of a loan tenure during which the borrower does not have repay anything. It can be described as a waiting period before the borrower will have to start paying the equated monthly installments (EMIs) for his or her loan.
Official links
References
- Scheme Guidelines
- https://msde.gov.in/en/schemes-initiatives/Other-Schemes-and-Initiatives/Skill-Loan-Scheme
Apply
Apply nowOpens the official application or programme portal in a new tab. If in doubt, confirm details on the ministry site.
Frequently asked questions
- What is the purpose of Skill Loan Scheme?
- Skill Loan Scheme is a government welfare initiative designed to support Individual, Individual through benefits related to Skills & Employment, financial assistance, subsidies, social welfare, healthcare, education, or livelihood support.
- Who can apply for Skill Loan Scheme?
- Eligibility for Skill Loan Scheme may depend on factors such as income category, age, gender, occupation, state of residence, social category, and government-defined beneficiary criteria.
- What benefits are offered under Skill Loan Scheme?
- Benefits under Skill Loan Scheme may include financial assistance, subsidies, scholarships, insurance support, healthcare benefits, pension support, training assistance, or welfare services depending on the scheme guidelines.
- Which department manages Skill Loan Scheme?
- Skill Loan Scheme is managed by Ministry Of Skill Development And Entrepreneurship and may be implemented through district offices, online portals, CSC centres, banks, or authorised government agencies.
- Can users apply online for Skill Loan Scheme?
- Yes, eligible applicants may be able to apply online for Skill Loan Scheme through official government portals, authorised service centres, or digital application systems depending on the implementation process.
- Is Aadhaar mandatory for Skill Loan Scheme?
- Many government schemes may require Aadhaar verification, identity proof, or linked bank account details for beneficiary validation and direct benefit transfer processing.
- Where can users apply for Skill Loan Scheme?
- Applications for Skill Loan Scheme may be submitted through government departments, official scheme portals, CSC centres, district offices, welfare departments, or authorised service centres.
- What documents may be required for Skill Loan Scheme?
- Applicants may need Aadhaar card, income certificate, residence proof, bank account details, caste certificate, photographs, educational records, or occupation-related documents depending on scheme eligibility requirements.
- Is income certificate required for Skill Loan Scheme?
- Income certificate requirements may vary depending on beneficiary category, subsidy eligibility, and financial assistance criteria defined under Skill Loan Scheme.
- Is Skill Loan Scheme a central government scheme?
- Yes, Skill Loan Scheme is a central government welfare initiative that may be implemented across multiple states through authorised departments and agencies.
- Can students apply for Skill Loan Scheme?
- Eligible students studying in recognised institutions may apply for Skill Loan Scheme depending on educational qualification, category, income limit, and academic eligibility.
- Is scholarship amount provided under Skill Loan Scheme?
- Skill Loan Scheme may provide scholarship assistance, tuition support, educational reimbursement, or financial aid for eligible students.
- Does Skill Loan Scheme provide healthcare or insurance support?
- Skill Loan Scheme may provide healthcare assistance, insurance coverage, cashless treatment support, medical reimbursement, or hospital-related benefits depending on the scheme structure.
- Can beneficiaries use Skill Loan Scheme at government hospitals?
- Eligible beneficiaries may be able to access services at empanelled hospitals, government healthcare facilities, or authorised healthcare providers depending on scheme participation rules.
- Can CSC centres help users apply for Skill Loan Scheme?
- Many government schemes may be accessible through nearby CSC centres, authorised digital service centres, or welfare facilitation offices.
- How can users check the latest updates for Skill Loan Scheme?
- Users should verify official notifications, department announcements, application deadlines, and eligibility updates through authorised government portals or implementing agencies.
- Are there deadlines for applying to Skill Loan Scheme?
- Some schemes may operate through fixed application windows, annual registration cycles, or department-specific deadlines depending on scheme implementation policies.
- Can beneficiaries track application status for Skill Loan Scheme?
- Certain schemes may provide online application tracking, beneficiary verification systems, or status-check facilities through official portals.
- Where can users get help for Skill Loan Scheme in All India?
- Users in All India may seek assistance through CSC centres, district welfare offices, government departments, agriculture offices, social welfare departments, or authorised facilitation centres.
- Which nearby public services may help with Skill Loan Scheme applications?
- Depending on the scheme, users may require support from Aadhaar centres, CSC centres, banks, hospitals, post offices, or government welfare offices for document verification and application assistance.