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PMAY: Government to provide $70,000 loan to help complete houses under PMAY-G

By on August 25, 2022 0
The Center is set to introduce a credit guarantee scheme for beneficiaries in rural areas who are struggling to complete the construction of pucca houses under the Modi government’s flagship, Pradhan Mantri Awas Yojana (Gramin).

The Ministry of Rural Development is in the process of finalizing the outlines of a credit guarantee scheme which will provide financial assistance of 70,000 per beneficiary in rural areas. The program is being formulated as several beneficiaries struggle to complete the construction of sanctioned houses due to the skyrocketing cost of building materials after the pandemic outbreak.

According to sources, the program will involve the vast network of self-help groups (SHGs) in rural areas. SHGs will act as guarantor for a beneficiary willing to take out an easy loan of 70,000 from the bank.

The government has set an ambitious target of completing 2,71,92,795 pucca houses under PMAY (Gramin) by March 2024. According to statistics from the Ministry of Rural Development, 1,96,62,963 houses have been completed. The goal now is to complete 75,29,832 pucca houses in 16 months. PMAY (Gramin) has been implemented since April 1, 2016 and pledges aid of 1.20 lakh in plains and 1.30 lakh in hilly areas to rural households to construct a pucca house with basic amenities. The cost is shared on a 60:40 ratio between the Center and the state (it’s a 90:10 ratio for the hill states). Thanks to the new loan program, the beneficiary will be able to tap into additional funds up to Rs 70,000.

In the first phase of PMAY(G) from 2016-17 to 2018-19, states were supporting the completion of 30 lakh houses per year. However, the pace had to double to 65 lakh houses per year to meet the mission target, which was also revised.