What are the major components of PMAY?

Pradhan Mantri Awas Yojana (PMAY) scheme aims to provide affordable housing to the weaker sections of the society, urban poor, the lower-income group people, and rural poor. This scheme involves the plan of constructing around 20 million houses at an affordable price by March 31, 2022. 

PMAY has mainly four major components:

  1. In-Situ Redevelopment: It aims at developing the area of land under slum areas and providing them with urban establishments.
  2. Credit Linked Subsidy: Government will provide an interest subsidy of 6.5% on housing loans for a period of 15-20 years to make housing affordable. This subsidy will only be available for loan amounts up to Rs. 6 Lakhs. All the lending institutions involved in this scheme will directly credit the interest subsidy to the beneficiaries’ accounts and will result in diminished Equated Monthly Installment (EMI) and reduced housing loan amount.
  3. Affordable Housing in Partnership (AHP): Affordable housing will be provided to the economically weaker sections, in partnership with the Public and Private sector.
  4. Enhancement and construction of beneficiary led house: Financial assistance of Rs 1.5 Lakh will be provided to families of EWS categories which doesn’t fall in the above three categories. This is to construct new houses or develop their existing houses. The new houses will be constructed using the eco-friendly technology, and to old and disabled people their houses will be allotted on ground floors.

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