Government Set to Bring Smiles to Small Home Buyers with Anticipated Subsidy on Loans

A senior official revealed that the Finance Ministry is actively considering a proposal to earmark Rs 60,000 crore for facilitating subsidized loans for small homebuyers in urban areas over the next five years. This initiative aligns with Prime Minister Narendra Modi’s Independence Day announcement and is currently in the process of being prepared for Cabinet approval.

Under this scheme, homes priced below Rs 50 lakh will be eligible for subsidized loans. Sources suggest that the program is poised to provide an annual interest rate subsidy ranging from 3% to 6% for loans up to Rs 9 lakh.

The potential beneficiaries of this scheme are approximately 25 lakh low-income urban homebuyers.

In his August 15th address, PM Modi stated, “We are coming up with a new scheme that will benefit families that live in cities but are living in rented houses, or slums, or chawls and unauthorized colonies.”

This initiative follows a previous scheme for low-income homebuyers that was in effect from 2017