Scholarship Scheme: National Means-cum-Merit Scholarship Scheme (NMMSS), 2008

Policy Update
Ananya Sitoke

Background:

“Education is the pre-eminent device for socio-economic, political, and cultural transformation.”

National Means cum Merit Scholarship Scheme is a central sector scheme announced by the former Finance Minister, P Chidambaram, in the 2007-08 annual budget. The Ministry responsible for the scheme’s functioning is the Department of School Education & Literacy, Ministry of Education. This scheme provides scholarships to economically disadvantaged students to prevent dropouts after class VIII and encourage continued education.

Each year, one lakh scholarships of Rs. 12000/- per annum are awarded to selected class IX students, with renewal available for classes X to XII in State Government, Government-aided, and Local body schools. Eligible students must have a parental income of no more than Rs. 3,50,000/- per annum. Each State/UT has a specific quota for scholarships, along with reservations for different categories based on local norms.

Functioning:

For the selection of Fresh Awardee Students, each State/UT conducts its test. To qualify for the selection test, students must have at least 55% in their Class VII exams (5% relaxation for SC/ST). Only regular students from Government, Government-aided, and local body schools can apply; students from NVS, KVS, and residential schools are ineligible.

Eligible students must pass two tests: the Mental Ability Test (MAT), which assesses reasoning and critical thinking, and the Scholastic Aptitude Test (SAT), covering science, social sciences, and mathematics. A minimum of 40% in aggregate is required (32% for SC/ST) to qualify for the scholarship. To maintain it, students must pass Class IX to X and XI to XII on their first attempt, achieving at least 60% (55% for SC/ST) in Class X.

Registration for the scholarship is done through the National Scholarship Portal (NSP). Applications are verified by state authorities and sent to the MHRD, which disburses funds via Direct Benefit Transfer (DBT) through SBI.

Performance:

The Cabinet has approved the continuation of the scheme from FY 2021-22 to FY 2025-26, covering the 15th Finance Commission cycle, with a total allocation of ₹1,827 crores. As of 2020, approximately 16.93 lakh scholarships have been awarded to students across the country.

A 2017 evaluation study by the National Institute of Educational Planning and Administration (NIEPA) found that the NMMS scheme positively impacts poor families by enabling meritorious children to pursue secondary and senior secondary education. Approximately 70.1% of beneficiary students would struggle to continue their studies without the scholarship. The scheme has reduced drop-out rates from Classes VIII to XII, allowing students to maintain the scholarship for four consecutive years. Beneficiaries typically use the funds for textbooks and stationery, leading to improved performance in Board exams and better eligibility for higher education opportunities.

Impact:

The most significant outcome of this initiative is the prevention of student dropouts or discontinuation of education due to financial constraints or lack of resources. For students from the lowest economic backgrounds, receiving a scholarship at the secondary and higher secondary levels is a dream come true. The National Means-cum-Merit Scholarship (NMMSS) offers them immense hope of gaining admission to a good college in the future without placing a financial burden on their parents.

This scholarship helps change the longstanding trend in our traditional society, where the meagre income earned through ordinary labour often forces children, particularly sons, to follow in their parents’ footsteps. For instance, a blacksmith’s son might become a blacksmith after completing his schooling, while a farmer’s son may take up farming as well.

Emerging Issues:

The primary objective of the National Means-cum-Merit Scholarship Scheme is to offer scholarships to children from economically weaker sections who are at risk of dropping out of school before completing secondary education. However, certain challenges can prevent the scheme from achieving its objective.

The scheme has been active for 16 years but lacks awareness among potential beneficiaries, which prevents the scheme from reaching those in need.
Some deserving students are ineligible due to not meeting the required percentage of marks in the test.
The scholarship amount increased from Rs. 6000 to Rs. 12000 per annum as of April 1, 2017, but inflation has reduced its impact on dropout rates by 2025.
Lakshadweep has not awarded any NMMSS scholarships since 2008, despite an allocation of 10 scholarships, undermining the scheme’s purpose.
There is a pressing need for assessment and monitoring of the awarded scholarships.

Way Forward:

The NMMSS scheme provides crucial support to underprivileged sections of our country, who have faced significant challenges preventing them from sending their children to school. However, the effectiveness of the scheme can be greatly enhanced by implementing the following recommendations:

1. Conduct annual orientation sessions in government and aided schools to inform students and parents about the scholarship scheme.

2. Provide remedial coaching or preparatory modules to help students meet eligibility requirements.

3. Revise the scholarship amount every three years.

4. Utilise existing education databases to streamline beneficiary tracking and reduce leakages.

The scheme plays a vital role in providing children with a structured education, thus paving the way for a transformative chapter in the history of Indian education.

References

Acharya, M. (2025, April 21). National Means-cum-Merit Scholarship Scheme. cleartax. In.

Department of School Education & Literacy. (n.d.). Central Sector Scheme–“National Means-Cum-Merit Scholarship Scheme” Revised Guidelines.

Government of India Press Information Bureau. (2020, February 6). National Means-cum-Merit Scholarship Scheme (NMMSS) has helped to reduce the drop-out rate at the secondary and senior secondary classes- HRD Minister. https://www.myscheme.gov.in/schemes/nmmss

Jain, M. (2009). National Means cum Merit Scholarship Scheme: A Review.

National Means-Cum-Merit Scholarship Scheme. (n.d.). myScheme. Retrieved June 8, 2025, from https://www.myscheme.gov.in/schemes/nmmss

National Means-cum-merit Scholarship Scheme | Ministry of Education, GoI. (n.d.). Department of School Education & Literacy. Retrieved June 8, 2025, from https://dsel.education.gov.in/scheme/nmmss

Raju, V. P.S. (2023, November). Affirmative Action in Secondary Education in India: A Study of National Means-cum-Merit Scholarship Scheme. Innovation The Research Concept, VIII(X).

About the Contributor: Ananya Sitoke is a researcher at IMPRI and an undergraduate student of Honours Political Science at Lady Shri Ram College for Women, University of Delhi, with a keen interest in Public Policy.

Acknowledgement: The author sincerely thanks Ms Aasthaba Jadeja and the IMPRI team for their valuable support.

Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organisation.