Interest Subsidy Scheme (ISS) under Pradhan Mantri Awas Yojana – Urban 2.0

Pradhan Mantri Awas Yojana – Urban 2.0 (PMAY-U 2.0) – ‘Housing for All’ Mission for urban areas is being implemented for 5 years from 01.09.2024 to provide Central Assistance to all eligible beneficiaries/ households/ implementing agencies through States/Union Territories (UTs)/Primary Lending Institutions (PLIs) to construct, purchase or rent a house at an affordable cost.

The Mission is implemented as Centrally Sponsored Scheme (CSS) except for the component of Interest Subsidy Scheme (ISS) which is implemented as a Central Sector Scheme.

Our Bank, is working as one of the Primary Lending Institution (PLI) for implementing Interest Subsidy Scheme (ISS) vertical of PMAY-U 2.0.

The beneficiaries from Economically Weaker Sections (EWS) having annual household income up to ₹3 lakh, Low Income Group (LIG) having annual household income of ₹3 lakh to ₹6 lakh and Middle-Income Group (MIG) having annual household income limit of ₹6 lakh to ₹9 Lakh will be eligible for the Interest Subsidy Scheme. For identification as an EWS/LIG/MIG beneficiary under the Scheme, an individual loan applicant will submit self-certificate/affidavit as proof of income.

A. Eligibility criteria for Interest Subsidy Scheme (ISS):

• Household income is not exceeding ₹9 lakh per annum
• Housing loan is not more than ₹25 lakh
• House value is not more than ₹35 lakh
• Carpet area of the house is not more than 120 sqm
• Families belonging to EWS/LIG/MIG segments, living in urban areas, should not own a pucca house (an all-weather dwelling unit) either in his/her name or in the name of any member of his/her family in any part of India.

 B. Beneficiary Family & Ownership of House:

• A beneficiary family will comprise of husband, wife, unmarried sons and/or unmarried daughters. User must fill the details of all family members with Aadhar Details, Date of Birth, Relationship with Beneficiary and Occupation.
• In case of a married male, details of wife should be included; and in case of unmarried children, their details should be included.
• In case if the borrower is unmarried and earning, then he/she can take loan with parents/siblings.
• The houses constructed/acquired/purchased should be in the name of the female head of the household or in the joint name of the male head of the household and his wife and only in cases when there is no adult female member in the family, the house can be in the name of male member of the household. In cases where the applicant is a widower, unmarried, separated person, or transgender, the house will be made in the individual’s name. In case of death of beneficiary(s), the legal heir of the beneficiary will get the benefit under the scheme.

C. Coverage

• All Statutory Towns as per Census 2011 and towns notified subsequently and areas falling within the boundary of Notified Planning Areas, Notified Planning/Development area under the jurisdiction of Industrial Development Authority/Special Area Development Authority/Urban Development Authority or any such Authority under State legislation which is entrusted with the functions of urban planning and regulations shall be included for the coverage under the Scheme.
• The Cities/Towns and areas falling under Notified Planning Areas, Notified Planning/Development area under the jurisdiction of Industrial Development Authority/Special Area Development Authority/Urban Development Authority or any such Authority, where PMAY-U is being implemented will continue to be covered under PMAY-U 2.0. Cities/towns which were not part of PMAY-U may also be included in PMAY-U 2.0 with due approval of MoHUA.
• List of cities can also be accessed at PMAY-U 2.0 website (URL – https://pmaymis.gov.in/PMAYMIS2_2024/PmayDefault.aspx) under publication.

 D. Exclusion (Ineligibility) criteria under ISS:

• The subsidy under the scheme will be provided only once for a property. If it is sold to someone else, the purchaser can’t take benefit of ISS on this property.
• If two or more family members take combined or separate loan on same property, they will be treated as same family for calculation of family income and benefit.
• In case a borrower has taken a housing loan from one Primary Lending Institution (PLI) and later on switches to another PLI for balance transfer/takeover, such beneficiary will not be eligible to claim the benefit of interest subsidy again. If a person has not claimed interest subsidy from first PLI, he/she shall not be eligible after balance transfer/takeover.
• Only loan up to ₹25 lakh with the house value up to ₹35 lakh will be eligible for subsidy under this vertical. If the family income or property value as assessed for sanction of loan is higher than eligibility limit, loan will not be eligible for subsidy.
• In case of any false declaration on income level by a beneficiary who has already availed the scheme benefit, he/she would be liable for legal proceedings under applicable laws.

E.  Subsidy Amount:

• Households having income up to ₹9 lakh, loan value up to ₹25 lakh for property value up to ₹35 lakh would be eligible for a subsidy
• A maximum release of interest subsidy of ₹1.80 lakh having maximum NPV of ₹1.50 lakh (at Discount Rate of 8.5%) shall be provided to eligible beneficiaries having a loan tenure of more than five years.

 F. How to Initiate Subsidy Claim (Flow Chart as per Annexure-A)

• For availing the benefit under ISS vertical, eligible beneficiaries will be required to register their demand through Unified web-portal (UWP) of MoHUA, GOI (URL – https://pmaymis.gov.in/PMAYMIS2_2024/PmayDefault.aspx).
• An undertaking by the beneficiary has to be submitted as a declaration of the fulfilment of eligibility criteria of income and not owning a pucca house anywhere in India on his/her name or any other family members in a specified format. (Annexure-B)

 G. Important Timelines

• Subsidy will be provided on housing loans sanctioned and disbursed on or after 01.09.2024 to eligible beneficiaries of EWS/LIG and MIG for purchase/ re-purchase/construction of houses.
• Subsidy will be released in 5 yearly instalments in housing loan accounts provided loan is standard and live at the time of release of subsidy and more than 50% principal is outstanding.
• Physical progress of the construction of a house is required to be updated on the annual basis, for claiming of each instalment against a loan account over 5 years. It is to be ensured that before releasing of 4^th instalment of subsidy to the beneficiary the geo-tagging of house at completed level is to be captured in MIS/UWP in 4th year.

H. Other important points to note:

• The Scheme will support construction of houses with basic civic amenities and social infrastructure like water, sanitation, sewerage, road, electricity etc.
• A ‘Pucca’ house is defined as an all-weather dwelling unit with roof and walls made up of sturdy, modern, and durable materials like burnt bricks, stones packed with cement or lime, cement concrete, timber, Galvanized Iron (GI) sheets, asbestos sheets, machine-made tiles etc.
• A loan given for land purchase and construction shall be limited to ₹25 lakh only and the cost of land plus construction cost shall not exceed ₹35 lakh and the size of the house constructed shall not exceed 120 sqm.
• The subsidy will be provided to those beneficiaries who have submitted the approved layout plan to the Bank as per guidelines of States/UTs.
• A beneficiary will be eligible for availing benefit under any of the verticals of PMAY-U 2.0 scheme. The beneficiary who has been allotted house under any of the housing scheme of Central Government, State/UT Government and Local Self Government in last 20 years in urban or rural areas, shall not be eligible to seek benefit under PMAY-U 2.0.
• All eligible beneficiaries (including family members) should have an Aadhaar/ Aadhaar Virtual ID integrated with the details of beneficiaries.
• Under the scheme, there shall be a mandatory lock-in period of five years from the disbursal of first instalment of housing loan under ISS verticals and the beneficiary shall not be allowed to sell/ transfer the house during the lock-in period.
• A citizen who wants to take loan and avail interest subsidy is required to submit the application through Unified Web Portal of PMAY-U 2.0, Common Service Centre (CSC) or by visiting the concerned Urban Local Bodies/Municipalities/Primary Lending Institution (PLI).
• The houses under PMAY-U 2.0 will be used only for residential purpose and shall not use for any other activities and the same will be self-certified by the beneficiaries. Otherwise, the Subsidy will be discontinued, and recovery of already leased amount shall be recovered.

The Frequently Asked Questions given under the ‘Support/FAQs’ link in the Unified Web-portal (URL – https://pmaymis.gov.in/PMAYMIS2_2024/PmayDefault.aspx) may be referred for further clarification on the scheme guidelines.

The PMAY U 2.0 User Manual has been given under the ‘Publication’ link in the Unified Web-portal (URL – https://pmaymis.gov.in/PMAYMIS2_2024/PmayDefault.aspx) may be referred for Standard Operating Procedure for using the portal by the beneficiaries and PLI.