Aiming at boosting the construction of houses for economically weaker section (EWS) of society, a new scheme for providing interest subsidy has been approved.
"The interest subsidy scheme of housing for the urban poor has been approved to make housing affordable and within the repaying capacity of EWS and low income group (LIG)," said Housing and Urban Poverty alleviation minister Kumari Selja today.
The operational modalities of the scheme are being worked out. The scheme is expected to address the issues of availability and affordability of institutional loans to EWS and LIG in urban areas.
The scheme is meant to encourage poor sections to avail of loan facilities through commercial banks/HUDCO for the purposes of construction of houses and avail 5 per cent subsidy in interest payment.
"One can avail 5 per cent interest subsidy on loans upto Rs 1 lakh for EWS housing. With this the poor who have the land through various grants but no money for construction can have access to loans with the interest subsidy facility," she said.
The EMI will be lower than Rs 600 on this subsidized loan of Rs 1 lakh taken for 15-20 years and the scheme has a budget of Rs 1,100 crore.
The scheme envisages construction of a total 3.10 lakh dwelling units in the country.