Skill Loan Scheme

This topic of “Skill Loan Scheme” is important from the perspective of the UPSC IAS Examination, which falls under General Studies Portion.


  • Skill Loan Scheme launched in July 2015
  • Provides institutional credit for skill development courses aligned with NSQF leading to certificate/diploma/degree by training institutes.


  • Ministry of Skill Development and Entrepreneurship

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  • To provide credit for skill development courses aligned with NSQF
  • To facilitate skill development of individuals.


  • Courses aligned with NSQF
  • Quantum of finance up to Rs. 1.5 lakhs
  • No minimum duration for courses
  • Base rate + 1.5% interest
  • Moratorium period for the duration of the course
  • Repayment period of 3-7 years
  • Loan coverage for course fees and expenses
  • No collateral required
  • Credit Guarantee Fund for Skill Development for loans sanctioned on or after 15th July 2015


  • Any individual who has secured admission in a course run by ITIs, Polytechnics, schools/colleges recognized by education boards/universities, training partners affiliated to NSDC/Sector Skill Councils, State Skill Mission, State Skill Corporation.

Implementation Strategy:

  • Applicable to member banks of Indian Banks’ Association and other banks and financial institutions advised by RBI
  • Guidelines provided to banks for operationalizing the skilling loan scheme.

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