Pradhan Mantri Awas Yojana (PMAY)

Pradhan Mantri Awas Yojana is an affordable housing scheme launched by the Government of India under the Ministry of Housing & Urban Affairs in June 2015. The scheme aims to provide affordable housing to the urban & Gramin residents by offering interest subsidies on loans. The objective behind this scheme is to achieve the mission of “Housing for all by 2022” set up by the Government of India. This scheme was launched after seeing the hike in prices of property and land in the country, which has reduced the affordability to purchase property and land by the majority residents of the country.

The credit-linked subsidy scheme (CLSS) under the PMAY scheme aims to provide or construct more than 20 million houses for particular sections of the society. The interest subsidy can be availed by individuals on loans taken for construction, acquisition, repurchase of houses, and for making any additions in their existing houses.

Individuals in India who want to construct a house can avail the interest subsidies if they belong to the below-mentioned groups including Economically weaker sections (EWS), Lower Income Group (LIG), or Middle Income Group (MIG).

Interest Subsidy rates for different sections

Economic Section	Subsidy Interest
EWS	6.5%
LIG	6.5%
MIG I	4%
MIC II	3%

PMAY is Divided into two parts- PMAY Urban and PMAY Gramin.

Pradhan Mantri Awas Yojana Urban (PMAY-U)- Under this scheme, around 4330 towns and cities come under the PMAY-U. PMAY-U is working with the Urban development authority, special area development authority, and other authorities who look at the urban planning and regulations.

The scheme has divided its work into three phases:

Phase 1: Cover 100 cities across states & UTs between April 2015 to March 2017

Phase 2: Cover 200 more cities between April 2017 to March 2019.

Phase 3: And, from April 2019 to March 2022, to cover the remaining areas.

As of August 2020, the work progress as per the data available from the Urban Housing and Urban Affairs Ministry is as follows:

Sanctioned Houses: 1.06 crore
Completed & Occupied Houses: 35 Lakhs
Grounded for construction Houses: 67 Lakhs

The total investment passed for PMAY as per the latest data is ₹ 6.31 lakh crores of which the assistance by the central government is Rs.1.67 lakh crores. The funds of approx. ₹ 72,646 crores has been released so far by the government under the scheme.

2. Pradhan Mantri Awas Yojana Gramin (PMAY-G)- The PMAY-G was earlier known as the Indira Awas Yojna which was renamed in March 2016. This scheme is targeted to promote affordable housing in all rural areas excluding those of Delhi and Chandigarh.

The main objective of PMAY-G is to provide homes to the people currently living in the decrepit houses so that they can have pucca houses. People living in plain areas can avail up to ₹ 1.2 Lakh and the people living in North-Eastern, hilly and difficult areas can avail up to ₹ 1.3 Lakh under this scheme.

Around 1,03,01,107 houses have been sanctioned in the rural areas so far as per the data available from the Ministry of Rural Development.

Under the PMAY scheme, the cost of housing will be shared by central and state government in the following ways:

60:40 for plain regions
90:10 for North Eastern and hilly areas

Beneficiaries of the PMAY scheme will be identified from the Socio-Economic and caste census (SECC) which include-

Scheduled caste and tribes
Non-SC, ST, and Minorities under BPL
Freed Bonded laborers
And more

Key Parameters of Pradhan Mantri Awas Yojna (PMAY):

Particulars	EWS	LIG	MIG I	MIG II
Household Income (P.a.)	₹0 - 3 lakhs	₹3,00,001 - 6,00,000	₹6,00,001 - 12,00,000	₹12,00,001 - 18,00,000
Eligible Loan Amount (₹)	Up to ₹6,00,000	Up to ₹6,00,000	Up to ₹9,00,000	Up to ₹12,00,000
Interest Subsidy (P.a.)	6.50%	6.50%	4.00%	3.00%
Loan tenure (Max.)	20 Years	20 Years	20 Years	20 Years
Dwelling unit carpet area (Max. In Sq. M,)	30	60	160	200
Discount Rate for Net Present Value calculation of interest subsidy	9.00%	9.00%	9.00%	9.00%
Maximum Interest Subsidy Amount	₹2,67,280	₹2,67,280	₹2,35,068	₹2,30,156
Sanctioned Lump-sum amount paid to PLIs in instead of Processing Fee to the extent of subsidy the loan amount.	₹3,000	₹3,000	₹2,000	₹2,000
Application on existing home loans was sanctioned on or after	17th June 2015		01st July 2017
Applicability for No Pucca Houses	Not for renovation or up-gradation		Yes	Yes
Woman Ownership or Co-ownership	Mandatory for new acquisition and Not mandatory for an existing property		Not mandatory	Not mandatory
Quality of House or Flat Construction	National Building Code, BIS Codes, and as per NDMA Guidelines were adopted
Building Design Approvals	Compulsory
Civic Infrastructure like water, sanitation, road, electricity, etc.)	Compulsory

Components of PMAY:

There are four major components of PMAY:

In Situ Slum Redevelopment (ISSR):

Under the component of ISSR, there is central assistance of ₹ 1 lakh per house for all houses constructed for eligible slum dwellers. Flexibility is being given to states and cities to deploy assistance for other slum areas that are being redeveloped. As per this policy, additional FSI/FAR or TDR is provided to slums that are on privately owned land, states, and cities, and in this case, there is no central assistance.

2. Credit Linked Subsidy Scheme (CLSS):

The CLSS provides interest subsidies on home loans to the people eligible for this scheme. The designated bodies by the ministry include Housing and Urban Development Corporation (HUDCO), National Housing Bank (NHB), and State Bank of India (SBI) which will act as Central Nodal Agencies (CNAs) to channelize the subsidiaries. The subsidy rates, loan amount, interest subsidy amount & other details for PMAY is presented below:

	EWS	LIG	MIG I	MIG II
Maximum Home Loan amount	Up to ₹ 3 Lakh	₹ 3 lakh - 6 lakh	₹ 6 lakh - 12 Lakh	₹ 12 lakh - 18 Lakh
Interest subsidy	6.50%	6.50%	4.00%	3.00%
Maximum interest subsidy amt.	₹ 2,67,280	₹ 2,67,280	₹ 2,35,068	₹ 2,30,156
Carpet area (maximum)	30 sq. m.	60 sq. m.	160 sq. m.	200 sq. m.

3. Affordable Housing in Partnership (AHP):

Under AHP, there is a central assistance of ₹ 1.5 lakh per EWS house provided by the government of India for the projects being built in states & UTs in partnerships with private organisations. There can be a mix of houses of different categories under an affordable housing project, but there should be at least 35% of houses for the EWS category to be eligible for getting this central assistance.

4. Beneficiary Led Construction (BLC):

Central assistance of up to ₹ 1.5 lakh per EWS house is given to eligible families of EWS categories for the construction of individual houses who cannot avail the benefits of above mentioned components. To ascertain the ownership of land and other details like the eligibility and economic status, the building plan and information are being submitted by the beneficiary which is being validated by the Urban Local Bodies. Central Assistance is directly released to the account of the beneficiary, along with State, UT, or ULB share, if any, through Direct Benefit Transfer (DBT) by States and UTs.