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06 MAY, 2021

With sky-high real estate prices, it has become difficult for the common man to have a house of his own. Often, people stay in rented houses, as they cannot afford to own one. Thankfully, the Government of India is taking positive measures through aspirational housing schemes to provide affordable housing for people. One such scheme is the Pradhan Mantri Awas Yojana.

What is Pradhan Mantri Awas Yojana?

Pradhan Mantri Awas Yojana is a housing scheme that aims at providing affordable housing for all. It was launched by Prime Minister Narendra Modi in June 2015. Under the PMAY Credit-linked Subsidy Scheme, first time homebuyers can avail a subsidy on the interest repayment of their home loan.

This subsidy is available for people who belong to the category of Economically Weaker Sections (EWS) of the society, Lower-Income Groups (LIG) and Middle-Income Groups (MIG) I and II. Moreover, in order to take the benefit of subsidy under this housing scheme, a woman should be the owner or co-owner of the house.

The table below depicts the subsidy provided under the PMAY scheme.


Annual income

Rate of interest subsidy

Maximum loan amount

Economically Weaker Sections (EWS)

Rs 3 Lakh


Rs 6 lakh

Lower Income Group (LIG)

Rs 3 lakh – 6 lakh


Rs 6 lakh

Middle Income Group –I (MIG)

Rs 6 lakh -  12 lakh


Rs 9 lakh

Middle Income Group - II

Rs. 9 lakh - Rs 18 lakh


Rs 12 lakh


Benefits of PMAY scheme

Housing for all

PMAY scheme is an inclusive scheme to provide housing for all. Anyone from the beneficiary groups classified basis economic criterion can claim this benefit. Moreover, PMAY also helps uplift the women of the house. To avail the benefit of this subsidy, it is compulsory for a woman from the family to be the owner or co-owner of the property.


PMAY is highly regulated. Due to this, there are lesser chances of legal complications in the ownership of the house. In addition, in housing schemes like PMAY, typically, the projects are completed in a timely manner and, it is ensured that legal and judicial clearances are in place.

Affordable and financially feasible

The price of the houses under the PMAY scheme is lower than the market price in most cases. The houses are affordable which makes it easier for people to take benefit of the scheme. Often such schemes have a location advantage. Accordingly, you can get a house of your own under PMAY in a prime location.

Safe investment

PMAY is regulated by government bodies, and is usually a low-risk form of investment comapred to any other real estate investment.


PMAY helps you purchase your house without draining your savings. As it is highly regulated, it ensures you face no legal issues. Also, it is contributing towards replacing slums with ‘pucca’ houses, benefiting a larger population and promoting overall development in the country. So what are you waiting for? Apply for a home loan under PMAY today and watch your dream come to reality.

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Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.