Banks told to push loan subsidy scheme

With only a few takers showing interest in 'availing' loan subsidy scheme of the Pradhan Mantri Awas Yojana (Urban) plan, the Ministry of Housing & Urban Affairs has directed National Housing Bank (NHB), HUDCO and public sector banks to aggressively promote credit linked subsidy scheme.

Though the final target is yet to be set, the government is aiming to construct about 1.5 crore houses under the scheme to meet the target of housing for all by 2022.

According to sources, the financing agencies involved in the project faced the wrath of senior officials for not promoting the scheme among homebuyers.

"The banks have been strictly told to aware potential homebuyers about the scheme. The financing agencies have also been told to submit a detailed action plan for the better implementation of the credit linked subsidy scheme," sources said, adding that banks have been directed to sensitise their executives at branch level about the scheme.

According to sources, Housing Secretary Durga Shanker Mishra, while reviewing the progress of affordable housing under CLSS, directed two central nodal agencies to prepare action plans to ensure that at least one-fourth of the mission target is met under credit linked subsidy scheme of PMAY (Urban).

"Given that the extension of bringing MIG beneficiaries under the loan subsidy ambit would come to an end in December, the agencies have been directed to identify at least 2 lakh MIG home buyers by the end of the year," the sources said.

Of the total beneficiaries under loan subsidy scheme, 75 per cent were serviced by housing finance companies while public sector banks could reach out to only 12 per cent.

Under the scheme, EWS and LIG beneficiaries get an extended interest subsidy of 6.50 per cent, which is 4 per cent for MIG with annual income of Rs 6 to Rs 12 lakh on a 20-year loan of Rs 9 lakh and 3 per cent interest subsidy for MIG with an annual income of Rs 12-18 lakh on a loan of Rs 12 lakh.