PMAY Rural Home Loan Scheme 2021 – Subsidy / Interest Rates

PMAY Rural Home Loan Scheme 2021: Pradhan Mantri Awas Yojana Grameen (PMAY-G), Indira Awaas Yojana The new form of Grameen Awas Yojana has now become more attractive to the beneficiaries. Prime Minister Narendra Modi announced the new home loan scheme under PMAY-G on 31 December 2016 under which the central government will provide interest subsidy on home loans in rural areas.

Till now, there was an alternative home loan scheme under Pradhan Mantri Awas Yojana – Gramin, with a maximum loan amount of Rs. 1.20 lakh in plains and Rs. 1.3 lakhs in hilly states, difficult areas and IAP district apart from financial assistance. Full details of PMAY Rural Home Loan Scheme announced by Narendra Modi are given below.

PMAY Rural Home Loan Scheme 2021

As per the announcement, the home loan is Rs. An interest subvention of 3% will be received on the Rs 2 lakh taken in 2021 for the construction or expansion of houses in rural areas. The 3% subsidy on interest on home loans under PMAY-G will reduce the effective interest rate and hence EMI by a significant margin.

Currently home loans are available from nationalized banks, private banks and non-banking finance institutions at an average interest rate of 8.5%. After the subsidy of 3% under PMAY-G, the effective interest rate is reduced to around 5.5%, which will result in lower EMI and hence lower interest burden on the borrower.

The basic calculation of subsidy / interest rates and EMI for PMAY-G home loan is given below.

PMAY-G Home Loan EMI Calculations

Home loan amount Tenure in months Bank interest rate Subsidy EMI before subsidy in Rs. EMI after subsidy in Rs.
Rupee. 2 lakhs 24 6.5% 3% 9091.13 919.13
36 6313.51 6039.18
48 4929.66 4651.3
60 4103.31 3820.23

Computation of average interest rate of 8.5% and a maximum of Rs. Is based on the loan amount of Rs. 2 lakhs for a tenure of 2 to 5 years. Home loan under Pradhan Mantri Awas Yojana – Grameen can be availed from any national, cooperative rural bank, private bank or non-banking financial institution.

Find more information about PM Awas Yojana Grameen in English and Hindi at the link given below.
In English: Pradhan Mantri Awas Yojana – Rural
In Hindi: Prime Minister’s Housing – Rural

Official website for PMAY Rural Home Loan Scheme 2021 –

Central Government Schemes 2021Popular Schemes at the Center:Pradhan Mantri Awas Yojana 2021PM Housing Scheme Rural (PMAY-G) Pradhan Mantri Awas Yojana

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