Interest subsidy

PMAY Urban 2.0 interest subsidy: official limits and how ISS works

पीएमएवाई शहरी 2.0 ब्याज सब्सिडी: आधिकारिक सीमाएँ

Last reviewed: 11 November 2026

The Interest Subsidy Scheme (ISS) is one of the four verticals of PMAY Urban 2.0. It is a Central Sector Scheme: the subsidy comes from the Government of India, through Central Nodal Agencies, to a participating Primary Lending Institution, and then into the borrower’s loan account. It is not the same product as the earlier Credit Linked Subsidy Scheme (CLSS) under the first PMAY-Urban mission.

This page sets out the official limits. It does not try to invent a rupee-by-rupee instalment for every possible loan, because the official frequently asked questions already say the subsidy is not a single fixed amount: it depends on the loan and the tenure, up to a published maximum. The table below is complete for those official parameters.

What the Interest Subsidy Scheme is

Subsidy is provided on home loans sanctioned and disbursed on 1 September 2024 or after, to eligible EWS, LIG and MIG families, for the purchase, re-purchase or construction of a house. Demand is registered on the official unified web portal and then forwarded to a lending institution. For identification as EWS, LIG or MIG under this vertical, an applicant submits a self-certificate or affidavit as proof of income.

A family that already owns a pucca house anywhere in India, or that has taken a government housing-scheme house in the last 20 years, is not eligible. The other Urban 2.0 family rules still apply, including the definition of a beneficiary family and the rule that a house supported with Central assistance should be in the woman’s name or a joint name, except in the cases the guidelines set out. See eligibility.

Official limits

The official frequently asked questions add two important points. First, if the loan is below ₹8 lakh or the tenure is below 12 years, the subsidy is reduced on a pro-rata basis. Second, a borrower may take a loan above ₹8 lakh, up to ₹25 lakh, but subsidy is not granted on the amount above ₹8 lakh. If the family income or the property value as assessed by the lender is higher than the eligibility limit, the loan is not eligible for subsidy.

This page does not offer a calculator that pretends to know the exact rupee instalment for every loan. The official maximum, the 4 per cent rate, the first ₹8 lakh, the 12-year cap and the pro-rata rule are the complete published parameters. The lender and the official portal apply them to a particular account.

How the five yearly instalments are released

The guidelines say the Ministry releases subsidy through a Central Nodal Agency to the lending institution, and that the borrower is informed by SMS. Each instalment is credited only if the loan is still active and more than 50 per cent of the principal is outstanding. The lending institution deducts the subsidy from the principal; the borrower then pays EMI on the reduced principal at the agreed interest rate, on a reducing-balance method.

Geo-tagging of the house is required. For a completed house that is being purchased, geo-tagging is done after the first instalment. For a house under construction, geo-tagging is required before each instalment, and the completed stage must be captured before the fourth instalment is released.

How this differs from the earlier CLSS

The earlier PMAY-Urban mission used a Credit Linked Subsidy Scheme, with its own income bands (including, in that older scheme, middle-income groups above the current ₹9 lakh Urban 2.0 ceiling) and its own subsidy design. Those older figures still appear on many unofficial pages. They are not the PMAY Urban 2.0 Interest Subsidy Scheme. CLSS tracking for the earlier mission had its own official channel, including the CLSS Awas Portal. If your loan was sanctioned under that earlier mission, use the official channel that belongs to that mission. If your loan is sanctioned and disbursed on or after 1 September 2024 and you are seeking Urban 2.0 ISS, use the unified Urban 2.0 portal.

How to register demand on the official portal

Register on https://pmaymis.gov.in/PMAYMIS2_2024/PmayDefault.aspx and choose the Interest Subsidy Scheme vertical. The steps for applying generally are on how to apply. After registration, the application is forwarded to the lending institution you select. The institution must be a participating Primary Lending Institution that has signed an agreement with a Central Nodal Agency.

State nodal agencies are expected to help beneficiaries with approvals and documents, and to hold loan melas and reviews with lenders. Lending institutions are required to display the scheme at their branches.

What the lending institution checks, and when subsidy cannot be claimed again

The lender assesses income, the property, and repayment capacity. Official exclusions include:

• Subsidy is given only once for a property. If that house is later sold, the buyer cannot claim ISS on the same property.
• If two or more family members take a loan on the same property, they are treated as one family for income and for the benefit.
• If a borrower transfers the remaining loan to another lender, the subsidy cannot be claimed again. A person who did not claim subsidy from the first lender is also not eligible after a balance transfer.
• A false income declaration can lead to legal proceedings under applicable law.

Related pages: eligibility, documents, PMAY Urban 2.0, how to apply.

How to read the parameter table

The table above is the full set of published limits for the Interest Subsidy Scheme. It is not a calculator, and it does not turn a loan amount you type here into a rupee instalment. The official frequently asked questions already say the subsidy is not one fixed amount. It depends on the loan and the tenure, up to the published maximum.

Read each row as a gate the lender and the Central Nodal Agency apply:

Two worked readings, using only those published gates, show why a personal calculator on this site would pretend to a precision the public rules do not give you as a single rupee. A loan of ₹8 lakh running for 12 years is the case the official FAQ associates with the maximum actual subsidy of ₹1.80 lakh. A loan of ₹5 lakh, or a 12-year loan that is partly above ₹8 lakh, is still decided by the pro-rata rule and by the “first ₹8 lakh only” rule. The exact instalment is visible later in the loan account and on the official login, not in a box on an unofficial page.

Release steps the guidelines describe

When the same house cannot be subsidised again

The guidelines are specific. Subsidy is given once for a property. A later buyer of that house cannot claim the Interest Subsidy Scheme on it. If two members of the family borrow against the same house, they count as one family for income and for the benefit. A balance transfer to another lender cannot be used to claim the subsidy a second time, and a borrower who never claimed it from the first lender is still not eligible to claim it after the transfer.

The scheme is a Central Sector Scheme. Money moves from the Government of India through the Central Nodal Agency to the lender, and then into the loan account. It is not a ₹2.50 lakh construction grant. That grant belongs to Beneficiary Led Construction and Affordable Housing in Partnership, and those verticals are for EWS families. A family may take a benefit under only one of the four Urban 2.0 verticals.

Register demand only at the official MIS. The wider application steps are on how to apply. Category rules are on eligibility.