COVID-19 Crisis: PMAY Home Loan Interest Subsidy Scheme Extended Till FY21

The Coronavirus outbreak and the nationwide lockdown have caused a big economic slowdown in the country. Considering the job losses and pay cuts affecting the common man during the pandemic, the Finance department had announced a one-year extension of the Pradhan Mantri Awas Yojana (PMAY) scheme, offering credit linked subsidy for the Middle Income Group (MIG) I & II. Eligible homebuyers can now apply for this scheme till the next financial year i.e. up to 31st March 2021.

On 14th May 2020, Finance minister Nirmala Sitharaman announced that the last day to avail the PMAY-U scheme subsidy has been changed from 31st March 2020 to 31 March 2021 for MIG segment. In the case of EWS (Economically Weaker Section) and LIG (Lower- Income Group) segments the last date will be 31 March 2022. This extension is expected to benefit an additional 2.5 Lakh beneficiaries in the country. Real estate builders opine that this is the right decision by the government and it will bring a much-needed boost to India’s housing sector.

What is PMAY Scheme & its Benefits?

The Pradhan Mantri Awas Yojana (PMAY) scheme was launched in 2015 by the Government of India with an objective of “Housing for all by 2022” in connection with the 150th birth anniversary of Mahatma Gandhi which falls in the same year. The main aim of this initiative is to make housing affordable and accessible for all and construct 20 million new homes across the country. The beneficiaries under the PMAY scheme are eligible for an interest subsidy of up to 2.67 Lakhs if they avail of a loan to buy or build a house.

Under the PMAY-U scheme, home loan borrowers in the MIG-I & II are eligible to get an interest subsidy of up to Rs 2,35,068 and Rs. 2,30,156 respectively. MIG-I group consists of buyers whose annual income falls between Rs 6 lakhs and Rs 12 lakhs and they will get an interest subsidy of 4% on a loan amount of up to Rs 9 lakhs. The MIG-II group consists of buyers whose annual income is between Rs. 12 lakhs and Rs. 18 lakhs and they are eligible to get an interest subsidy of 3% on a loan amount of up to Rs. 9 lakhs. For EWS and LIG sections, the subsidy on home loan interest rate is 6.5%. Thus the maximum amount of subsidy that can be granted is Rs 2.67 lakhs. The applicants should provide sufficient proof to claim their benefits. Refer table below:

Middle Income Group I (MIG I) Middle Income Group II (MIG II) Economically Weaker Section (EWS) Low Income Group (LIG)
Annual Household income Between Rs. 6 Lakh and Rs. 12 Lakh Between Rs. 12 Lakh and Rs. 18 Lakh Up to Rs. 3 Lakh Between Rs. 3 Lakh and Rs. 6 Lakh
Subsidy on loan interest rate 4% p.a 3% p.a 6.5% p.a 6.5% p.a
Maximum subsidy amount 2.35 lakh 2.30 lakh 2.67 lakh 2.67 lakh
Maximum loan amount for subsidy 9 lakh 12 lakh 6 lakh 6 lakh
Maximum loan repayment tenure 20 years 20 years 20 years 20 years

Eligibility Criteria for Pradhan Manti Awas Yojana (PMAY) Scheme

The eligibility criteria for the PMAY scheme are as follows: In addition to the above, an applicant is required to meet the following criteria to avail of PMAY scheme benefits.

  1. The beneficiary family comprises husband, wife, unmarried sons or/and daughters
  2. The applicant or any of the immediate family members must not own a house in any part of the country
  3. The annual income of the beneficiary should be within 18 lakhs including the income of the spouse
  4. The property should be co-owned by a female member of the family
  5. The applicant or his family must not have availed the benefits of any other housing scheme by the State or Central Government
  6. The applicant cannot avail the scheme benefits on an already constructed house
  7. If the applicant is married, both together in joint ownership or either of the spouses can get a single subsidy
  8. The location of the property should fall under all statutory towns as per Census 2011 and their adjacent planning area
  9. Existing home loan borrowers are eligible for this scheme provided they fulfil all the relevant eligibility criteria.

How to apply for PMAY Scheme?

Beneficiaries can apply for PMAY scheme either through online or offline mode. Individuals can apply online through the official website and can also track the status of the application through the website. The applicant should have a valid Aadhaar card to apply. Another option is to apply by filling up an application form available through Common Service Centre (CSC).

If you are planning to buy a home this year, check your eligibility for this subsidy scheme to avail the benefits. It’s the perfect time to invest in your dream home. Feel free to get in touch with our property advisor to know more details on home loans and payment schemes.


As the most trusted real estate brand in the nation, we at Confident Group strive to create a positive, smooth and transparent medium for potential home buyers with anything and everything related to home purchase. We provide informative and engaging articles which cover useful details across many verticals from the real estate sector. Our 2-decade long expertise in building infrastructure projects across Kerala and abroad backed by the trust of over 10,000 customers earned us the reputation of being the best as a real estate brand in Asia. We hope that our blogs will help in translating our experience for the prospective buyers who are looking for their dream home.

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