New Delhi, August 15th (PTI) – Prime Minister Narendra Modi Unveils Initiative to Ease Bank Loan Interest for Urban Home Ownership
In a significant announcement during his address on the 77th Independence Day, Prime Minister Narendra Modi shared the government’s upcoming initiative aimed at relieving interest burdens on bank loans for individuals aspiring to own homes in urban areas.
Modi outlined a tailor-made program set to launch soon, targeting middle-class urban residents currently grappling with the lack of homeownership.
Addressing the plight of underprivileged city dwellers without proper housing, the prime minister emphasized, “Urban middle-class families have dreams of having their own homes. In response, we’re about to introduce an imminent scheme.”
Further detailing the plan, he added, “To assist families living in rented spaces, unauthorized settlements, and makeshift homes within cities, we’ve decided to provide substantial financial relief in the form of reduced bank loan interest. This support will empower them to realize their dream homes.”
These revelations were made from the iconic Red Fort’s ramparts.
It’s essential to note that the existing Pradhan Mantri Awas Yojana Urban (PMAY-U) initiative already caters to the housing needs of the urban underprivileged.
The PMAY-U was initially launched by the prime minister on June 25, 2015, with the overarching goal of ensuring that all eligible urban beneficiaries across the country gain access to proper housing with essential amenities.
According to data reported by the Ministry of Housing and Urban Affairs, as of July 31, 2023, a total of 118.90 lakh houses have been sanctioned under various projects proposed by states and Union territories.
Out of these approved units, a remarkable 76.02 lakh houses have already been successfully completed and handed over to their rightful occupants.
The program operates through four distinctive approaches: beneficiary-led construction, affordable housing partnerships, in-situ slum redevelopment, and the credit-linked subsidy scheme. Each of these avenues adheres to specific eligibility criteria.
All proposals originating from states and Union territories have undergone meticulous evaluation by the ministry.
Officials have opted to extend the PMAY-U initiative’s timeline beyond the original cutoff of March 31, 2022, stretching it to December 31, 2024 (excluding the credit-linked subsidy scheme). This extension aims to ensure the completion of all houses sanctioned until March 31, 2022. Importantly, this extension preserves the existing funding allocation and implementation methodology of the scheme.
In terms of financial assistance, the Central government extends a fixed amount of Rs 1 lakh for the in-situ slum redevelopment strategy within PMAY-U. For the affordable housing partnership and beneficiary-led construction approaches, the government provides Rs 1.5 lakh.
Regarding the credit-linked subsidy scheme component of PMAY-U, eligible beneficiaries from economically weaker sections and low-income groups were previously entitled to an interest subsidy of 6.5 percent, equating to a maximum of Rs 2.67 lakh per household.