PMAY Urban 2.0 Interest Subsidy Scheme (ISS) 2026 - Apply Online, Eligibility & Subsidy

Central government's Pradhan Mantri Awas Yojana Urban (PMAY-U) now runs the interest subsidy vertical under PMAY-U 2.0 as the Interest Subsidy Scheme (ISS). The older Credit Linked Subsidy Scheme (CLSS) closed to new applications in 2022, and the CLSS Awas Portal (CLAP) at pmayuclap.gov.in is no longer the active portal for new home loan subsidy claims. Under PMAY-U 2.0, eligible families can get interest subsidy on home loans sanctioned and disbursed on or after 1 September 2024 through the official portal at pmay-urban.gov.in.

PMAY-U 2.0 is the 'Housing for All' mission of Ministry of Housing and Urban Affairs (MoHUA). It provides financial support to eligible urban families through four verticals - Beneficiary Led Construction (BLC), Affordable Housing in Partnership (AHP), Affordable Rental Housing (ARH) and Interest Subsidy Scheme (ISS). The ISS vertical is the new version of the old CLSS component, and it gives interest subsidy on home loans for purchase, repurchase or construction of houses.

PMAY Urban 2.0 Interest Subsidy Scheme (ISS)

The Interest Subsidy Scheme (ISS) is the current interest subsidy vertical of PMAY-U 2.0. It replaced the old Credit Linked Subsidy Scheme (CLSS), which stopped taking new applications in 2022. Under ISS, the subsidy is available on home loans sanctioned and disbursed on or after 1 September 2024 to eligible beneficiaries of EWS, LIG and MIG categories for purchase, repurchase or construction of houses.

Households with an annual income of up to ₹3 lakh (EWS), ₹6 lakh (LIG) and ₹9 lakh (MIG) are eligible for the scheme. A maximum interest subsidy of ₹1.80 lakh is available for eligible beneficiaries with a loan tenure of more than five years. The subsidy is paid at 4% on the first ₹8 lakh of the loan for a tenure up to 12 years, for households with income up to ₹9 lakh, loan value up to ₹25 lakh and property value up to ₹35 lakh. The maximum carpet area under this component is 120 sqm.

Under the ISS vertical, the subsidy is released in five yearly instalments through Direct Benefit Transfer (DBT) into the loan account of the beneficiary, provided the loan is active at the time of release and more than 50% of the principal is still outstanding. The subsidy is credited by the Primary Lending Institution (PLI) to the borrower's account upfront by deducting it from the principal loan amount.

How to Apply Online for PMAY Urban 2.0 Interest Subsidy

Eligible families can apply for the interest subsidy under PMAY-U 2.0 through the Unified Web Portal of the scheme. The application can also be submitted through a Common Service Centre (CSC) or by visiting the concerned Urban Local Body, Municipality or Primary Lending Institution (PLI).

STEP 1 - Go to the official PMAY-U 2.0 portal at pmay-urban.gov.in and open the 'Apply for PMAY-U 2.0' section on the homepage.

STEP 2 - Select the Interest Subsidy Scheme (ISS) vertical from the four options available under PMAY-U 2.0.

STEP 3 - Fill in the application form with personal details, income proof and loan details, and submit the required documents.

STEP 4 - Once the application is submitted, it is forwarded to the concerned PLI for further action as per the eligibility criteria. The subsidy is then released through DBT in five yearly instalments.

PMAY Urban 2.0 Interest Subsidy Highlights

Detail	Information
Scheme Name	PMAY Urban 2.0 Interest Subsidy Scheme (ISS)
Launched By	Ministry of Housing and Urban Affairs (MoHUA)
Beneficiaries	EWS, LIG and MIG families
Income Limit	Up to ₹3 lakh (EWS), ₹6 lakh (LIG), ₹9 lakh (MIG)
Subsidy Amount	Up to ₹1.80 lakh
Subsidy Rate	4% on first ₹8 lakh for up to 12 years
Application Mode	Online at pmay-urban.gov.in, CSC or PLI
Official Website	pmay-urban.gov.in

Eligibility for PMAY Urban 2.0 Interest Subsidy

The eligibility to avail the interest subsidy under the ISS vertical of PMAY-U 2.0 is as follows:

• EWS families with annual income up to ₹3 lakh can avail the subsidy on home loans for purchase, repurchase or construction of a house.
• LIG families with annual income up to ₹6 lakh are eligible for the interest subsidy under the ISS vertical.
• MIG families with annual income up to ₹9 lakh can also avail the benefit, subject to loan and property value limits.

The home loan must be sanctioned and disbursed on or after 1 September 2024 to be eligible for the subsidy. The maximum carpet area of the house under this component is 120 sqm, and the subsidy is released in five yearly instalments through DBT.

Difference Between CLSS and ISS

The old Credit Linked Subsidy Scheme (CLSS) under PMAY-U closed to new applications in 2022. It gave an upfront interest subsidy of 3% to 6.5% on home loans, with the subsidy credited directly to the loan account. Under the new PMAY-U 2.0, the interest subsidy vertical is now called the Interest Subsidy Scheme (ISS), and the subsidy is released in five yearly instalments through DBT instead of an upfront credit.

For more details on the PMAY-U 2.0 scheme guidelines, visit the official page at pmay-urban.gov.in/pmay-u-2.0-guidelines. For details on the Credit Linked Subsidy Scheme, check the official page at pmay-urban.gov.in/credit-linked-subsidy-scheme.

FAQ's

Is the old CLSS Awas Portal (CLAP) still active?

The old CLSS Awas Portal (CLAP) at pmayuclap.gov.in was used to track CLSS applications under the earlier PMAY-U. The CLSS closed to new applications in 2022, and the interest subsidy is now handled under the ISS vertical of PMAY-U 2.0 through the official portal at pmay-urban.gov.in.

What is the maximum subsidy under PMAY Urban 2.0 ISS?

The maximum interest subsidy under the ISS vertical is ₹1.80 lakh for eligible beneficiaries with a loan tenure of more than five years. The subsidy is paid at 4% on the first ₹8 lakh of the loan for a tenure up to 12 years.

How is the subsidy released under PMAY Urban 2.0 ISS?

The subsidy is released in five yearly instalments through Direct Benefit Transfer (DBT) into the loan account of the beneficiary, provided the loan is active and more than 50% of the principal is outstanding at the time of release.

Where can I apply for PMAY Urban 2.0 interest subsidy?

Eligible families can apply through the Unified Web Portal at pmay-urban.gov.in, through a Common Service Centre (CSC), or by visiting the concerned Urban Local Body, Municipality or Primary Lending Institution (PLI).

For more details on PMAY Urban 2.0, check the related articles on PMAY Online Form and Track PM Awas Yojana Application Status.