Pradhan Mantri Awas Yojana (PMAY)

The Credit-Linked Subsidy Scheme (CLSS) under the Pradhan Mantri Awas Yojana (PMAY) was announced by Prime Minister Narendra Modi and envisages the vision of ‘housing for all’ by the year 2022.  Kotak Mahindra Bank offers CLSS under PMAY, which provides interest subsidy on housing loans to eligible beneficiaries from the Economically Weaker Sections (EWS) / Low-Income Group (LIG) and middle-income group (MIG) segment. Pradhan Mantri Awas Yojana subsidy can be availed for constructing or purchasing a house, as per the eligibility criteria prescribed under the scheme, and the same is b.f. below:

Eligibility Criteria EWS-LIG MIG-I MIG-II
Maximum household income per annum Up to INR 6 lakhs INR 6-12 lakhs INR 12-18 lakhs
Maximum property area (carpet area) No restriction 160 sq. m 200 sq. m
Maximum loan amount for PMAY subsidy calculation INR 6 lakhs INR 9 lakhs INR12 lakhs
Maximum tenure for subsidy calculation 20 years 20 years 20 years
Interest subsidy (% p.a.) 6.5 percent 4 percent 3 percent
Pradhan Mantri Awas Yojana subsidy amount INR 2.67 lakhs INR 2.35lakhs INR 2.30 lakhs
Women ownership on property Yes Not applicable Not applicable
The beneficiary family should not own a pucca house in India Applicable Applicable Applicable
Housing loan sanction date to be eligible for subsidy After 17.06.2015 After 01.01.2017 After 01.01.2017

Objective of the Pradhan Mantri Awas Yojana

PMAY was started in 2015 for the following purposes:

  • Main objective: Housing should be affordable for everyone by 2022
  • To ensure that poorer sections of urban India own a house
  • To provide financial support to people who cannot bear the entire cost of building a residential property
  • To offer houses to the economically weaker sections (EWS)
  • To bring both public and private sectors together to improve the fate of the nation’s urban poor


Features of Pradhan Mantri Awas Yojana 

  • Upfront interest subsidy benefit on the principle outstanding
  • Aadhaar numbers of beneficiary families are mandatory for the MIG category
  • Interest subsidy will be available for a maximum loan tenure of 20  years, or the loan tenure availed by the borrower, whichever is lower
  • There is no cap on the loan amount or on the cost of property
  • The net present value (NPV) of the interest subsidy will be calculated at a discount rate of 9%
  • Additional loan, beyond the specified limits, if any, will be at non-subsidised rates



1 - The definition of ‘Beneficiary Family’ under EWS-LIG, MIG-I, and MIG-II Schemes will comprise of a husband-wife and their unmarried children. An adult earning member (irrespective of marital status) can be treated as a separate family/household

2 - Home extension/repair is included only under the EWS-LIG scheme; for this, the area limit (in terms of built-up area) for the EWS category will be 30 sq. m (323 sq. ft.) and for the LIG category it will be 60 sq. m (646 sq. ft.)

3 - EWS is defined as a household/family having an annual income of up to Rs 3 lakhs.

4 - LIG is defined as a household/family having an annual income of between Rs 2 lakhs to Rs 6 lakhs

5 - Interest subsidy on the housing loan is calculated at applicable rates for PMAY EWS/LIG/MIG-I/MIG-II Schemes respectively for a tenure of 20 years or the tenure of the loan, whichever is lower. The Government of India retains the supreme right of granting/rejecting the Pradhan Mantri Awas Yojana
subsidy, and the bank will not be held liable for the decision taken by the government.



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Frequently Asked Questions

Who can avail subsidy under CLSS in PMAY?

A beneficiary family that does not have any pucca house in any part of India is eligible for a subsidy through PMAY, as per the income criteria defined for the family.

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What is the definition of beneficiary family in accordance to PMAY?

The beneficiary family as defined under PMAY will comprise of the husband-wife and their unmarried children. An adult earning member (irrespective of marital status) can be treated as a separate family/household.

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Is women ownership mandatory for being eligible for this subsidy under PMAY?

Women ownership or co-ownership is mandatory for EWS and LIG only. However, this condition is not mandatory for self-construction / extension. Women ownership is not mandatory for MIG-I and MIG-II.

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How will I receive the interest subsidy that I’m eligible for under PMAY?

Once the subsidy amount is received from the NHB, it is credited to the borrower’s home-loan account as a part payment, and the EMI is proportionately reduced.

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I have a small business. Can I avail a home loan under PMAY?

Yes, you can avail this facility, subject to meeting the income and other criteria defined under this scheme.

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Disclaimer (Things you should know):

For loans: Credit at the sole discretion of the Bank and subject to guidelines issued by RBI from time to time. Bank may engage the services of marketing agents for the purpose of sourcing loan assets.

* Rs. 5,000 Flat processing fee applicable for women applicants.