Skill Loan Scheme

Brief
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).

Objectives
To enable youth and individuals to access affordable credit for skill development and improve employability without collateral requirements.

Eligibility Criteria
- 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

Benefits
- Loan amount ranges from ₹5,000 to ₹1,50,000
- Interest rate is Base Rate (MCLR) plus an add-on typically up to 1.5%
- Repayment period ranges from 3–7 years depending on loan amount
- Credit guarantee up to 75% provided under CGFSSD via NCGTC
- Provides collateral-free loans covering course fees (paid directly to institute) and related expenses such as assessment, examination, and study material
- Flexible repayment tenure and government-backed credit guarantee reduce risk for borrowers

Nodal Department
Ministry of Skill Development and Entrepreneurship (MSDE)