The Government of India often comes up with various schemes and plans that would enhance and uplift the living standards of its people. This extends to rural and urban parts of the country, spanning various states. The Central Government often forms a tie-up with State Governments, ensuring that these schemes are implemented effectively and reach all eligible families, individuals, or persons without any failure. For this, a proper and robust network and system must be established between the Central Government and its authorities, as well as with multiple State Governments and the local authorities under them.
The Pradhan Mantri Awas Yojana is one such scheme, and it is the primary point of discussion in this article.
Pradhan Mantri Awas Yojana (PMAY)
It is a scheme introduced by the Government, part of the Housing for All mission launched by the Government of India. The primary objective was to provide homeownership to all citizens by 2022. A major credit scheme was introduced under this mission, known as the Credit Linked Subsidy Scheme (CLSS), a subsidy scheme. It provides the eligible persons with an interest subsidy on the loans taken for the construction of a home. This can also be taken for purchase, extension, or even the renovation and improvement of the existing house.
The scheme is primarily aimed at supporting the Housing for All mission for the economically weaker sections (EWS) of society, as well as persons belonging to the low-income group and the middle-income groups. This arises from the fact that India is experiencing a highly projected growth in urbanisation, which in turn is increasing the pressure and demand for housing among the country’s population.
Credit Linked Subsidy Scheme (CLSS)
Credit Linked Subsidy Scheme or CLSS is a benefit that is offered under the PMAY scheme. This enables economically weaker sections, the middle-income group, and low-income groups to avail themselves of home loans for the construction, purchase, improvement, or renovation of their homes. However, they can enjoy a lower EMI (Equated Monthly Instalment), which is made available with the help of an interest subsidy.
According to this benefit, the interest subsidy amount will be credited to the beneficiary’s account upfront against the principal amount. This would then bring down the EMI to be paid back by the person with respect to the home loan taken. This would make the home loan an affordable one for the individual, as the outflow of their earnings on a monthly basis for loan repayment would be the lowest to the possible extent. The subsidy amount granted shall depend on the income group to which the person belongs, as well as the size of the property or unit used for financing the home loan.
Features of PMAY
– There shall be the availability of customised loan repayment schemes to the person availing such a loan.
– The process is simple, as free documentation and processing shall be provided by various banks in the country.
– Interest subsidy benefit is ensured to the economically weaker sections, low-income group, or medium-income group on the basis of the income and also the property or unit size used for availing the loan.
Benefits under PMAY CLSS Scheme based on Category of Income
The benefits available under the PMAY Scheme shall be as follows:
CLSS EWS or LIG (Lower-Income Group) Scheme
Persons with an annual household income above INR 3 Lakhs but below INR 6 Lakhs shall fall into this category. The maximum subsidy available to this person, belonging to the economically weaker sections and a low-income group of the society shall be 6.5%, and it should also be ensured that the property and the unit that is being purchased or constructed does not exceed a carpet area of 60 square meters, which is approximately 645 square feet (Approximately). The limit of the loan amount for which interest subsidy shall be available is INR 6 Lakhs.
CLSS MIG (Middle-Income Group) 1 Scheme
MIG 1, or the Middle-Income Group, is to include the persons earning an annual household income above INR 6 Lakhs but not above INR 12 Lakhs. The interest subsidy, which will be made available to the person, will be 4%. For this, it will also be ensured that the unit being constructed or purchased by the person does not exceed the carpet area of 160 square meters or 1722 square feet (Approximately). The limit of the loan amount for availing this benefit shall be limited to INR 9 Lakhs, with the tenure of the home loan being 20 years.
CLSS MIG 2 Scheme
Under MIG 2, the annual household income of the applicant should be between INR 12 lakh and INR 18 lakh. The maximum interest which would be made available to such person shall be 3%. And the carpet area of the unit being constructed or purchased here should not exceed 200 square meters or 2150square feet (Approximately). The limit for availing this loan is INR 12 Lakhs, with a tenure of 20 years for the home loan.
Eligibility of PMAY
The eligibility criteria shall include:
– If the applicant is a married couple, either of them alone or together holding the ownership on a joint basis shall be eligible to avail the subsidy, and this shall be counted as a single person.
– The applicant or the beneficiary should only have a maximum annual household income of INR 18 Lakhs to avail the benefit under this scheme.
– The applicant or the prospective beneficiary shall not own a pucca house in his or her name or the family member’s name anywhere in India.
– The applicant should also not have availed of any housing benefit from the Central Government under this scheme or any other scheme before.
Additional Points to be Considered
The following additional points shall be considered:
– It shall also be noted that for the PMAY, the beneficiary family shall include the husband, the wife, and their unmarried children.
– And under the MIG category, the case of an adult who is earning but single can also be considered as a separate household for availing this benefit.
– The Aadhar Number of the beneficiary and his family members shall be considered mandatory for availing of the scheme.
– The maximum loan tenure allowed for availing the PMAY benefit shall be 20 years or such other lower loan tenure.
– Any additional loan, if availed by the beneficiary above the specified limit, then the interest rate applicable shall be the non-subsidised one.
