PMAY (Urban) Extension - Everything You Must Know
PMAY, or Pradhan Mantri Awas Yojana, has been a blessing to people struggling to construct their peaceful abode. This flagship Indian Government housing scheme provides interest subsidies to borrowers belonging to the Economically Weaker Section (EWS), Low Income Group (LIG), and Mid Income Group (MIG).
The PMAY scheme has two types - PMAY (Urban) and PMAY (Rural). The central Government launched the scheme on 25th June 2015 and was expected to be operational until 31st March 2022. However, the Central Government has extended the scheme's end date to 31st December 2024.
This article enlists the facts about PMAY (U) extension and what it means for people applying for house loans.
PMAY (Urban) Extension - A Primer
The PMAY scheme is a revolutionary Central Government scheme to provide housing to all Indian citizens. The Government has announced that the revised deadline for submitting applications under the PMAY (U) scheme is 31st December 2025.
The Government has extended the deadline to provide financial assistance in the form of home loan interest subsidy to 122.69 houses already sanctioned before 31st March 2022.
The Government announced that between 2004 and 2015, the urban housing scheme facilitated the construction of 8.04 lakh houses. However, ever since the current Government assumed power, the housing scheme has gained traction.
According to the Government, the projected demand for new houses was 100 lakh in 2017. However, the Government has either grounded or given a green signal to the construction of 102 lakh houses across India.
Of the 102 lakh houses, 62 lakh houses are ready to be occupied. Of the 123 lakh houses sanctioned by the Union Government, 40 lakh applications were submitted after 2020.
Since the last date of PMAY (U) was originally 31st March 2022, several States and Union Territories requested the Centre to extend the implementation period by another two years. This prompted the Central Government to extend PMAY (U) to 31st December 2024.
PMAY (Urban) Extension - Everything You Must Know
The Central Government extended the PMAY (U) implementation period to 31st December 2024 primarily to honor States' and Union Territories' request to offer an extension.
The Union Government specified that while the central assistance on house loans was INR 20,000 crore between 2004 and 2014, the amount has touched INR 2.03 lakh crore since 2015.
The Government has already released subsidies worth INR 1,18,020.46 crore and plans to release INR 85,405 crore by 31st December 2024.
The Government believes that the extension of PMAY (Urban) will help States and Union Territories to finish the construction of sanctioned houses under the ISSR (In-Situ Slum Redevelopment), AHP (Affordable Housing in Partnership), and BLC (Beneficiary-Led Construction) verticals.
Besides ISSR, AHP, and BLC verticals, the PMAY (Urban) scheme also operates in the CLSS (Credit-Linked Subsidy Scheme) vertical.
The scheme is available in all urban areas of India, including notified towns and areas administered and controlled by industrial development authorities, special area development authorities, urban development authorities, and notified planning and development areas.
The central Government's responsibility is to provide money for the scheme's implementation, whereas the state governments select the beneficiaries and ensure smooth implementation.
A demand-driven approach is what best defines the Pradhan Mantri Awas Yojana. Here, the States and Union Territories conduct demand assessments to figure out the housing shortage.
Demand assessments are carried out by various agencies, including Urban Local Bodies (ULBs), State Level Nodal Agencies (SLNAs), Central Nodal Agencies (CNAs), Primary Lending Institutions (PLIs), and Implementing Agencies (IAs). Besides demand assessment, these agencies also ensure that the key objectives of the PMAY (U) scheme are fulfilled.
Conclusion
The Pradhan Mantri Awas Yojana (Urban) provides house loan interest subsidies to eligible borrowers. The subsidy ensures that the home loan rates become more affordable, thereby allowing Indian citizens to participate in the Government's vision of 'Housing for All.'
Under the PMAY (U) scheme, the EWS and LIG categories of borrowers get an interest subsidy of 6%. In contrast, the MIG-I and MIG-II borrowers get an interest subsidy of 4% and 3%, respectively. So, the maximum house loan interest subsidy stands at INR 2,67,280 for EWS and LIG, INR 2,35,068 for MIG-I, and INR 2,30,156 for MIG-II.
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