Question
What is the primary change introduced in the revamped
Model Skill Loan Scheme launched by Skill Development Minister Jayant Chaudhary?Solution
The primary change in the revamped Model Skill Loan Scheme, launched by Skill Development Minister Jayant Chaudhary, is the expansion of the lending network to include Non Banking Financial Companies (NBFCs) and small finance banks. This change addresses the low uptake of loans under the previous scheme, which was limited to member lending institutes of the Indian Banking Association (IBA) and thus had a restricted reach. By including NBFCs and small finance banks, the scheme aims to enhance access to a broader range of skill courses and provide higher loan limits, up to ₹7.5 lakh for high-end skilling courses, compared to the previous limit of ₹1.5 lakh. This expansion is expected to significantly improve fund utilization and cater to the rising costs of courses due to inflation, thereby supporting a larger number of borrowers in their skill development endeavors.
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