Mumbai: The Pradhan Mantri Awas Yojana (PMAY) has struggled to make a significant dent in Mumbai’s affordable housing crisis, with high land costs and the inability of applicants with irregular incomes to secure bank loans emerging as major roadblocks, said MHADA CEO Sanjeev Jaiswal at the BRICS Friendship Cities conclave on Wednesday.Jaiswal said the problem was particularly acute in the Mumbai Metropolitan Region (MMR), where MHADA has constructed nearly 50,000 homes under its housing initiatives, but has been unable to allot between 10,000 and 15,000 of them because prospective beneficiaries could not arrange financing.“MHADA has constructed close to 50,000 homes in the larger MMR area, but 10-15,000 of these homes we are not able to allocate because individuals were not able to secure funding from banks,” Jaiswal said during a session on housing.He said the experience highlighted a key limitation in implementing PMAY in Mumbai. While the scheme provides a subsidy of Rs 2.5 lakh to eligible beneficiaries, the subsidy alone is insufficient to bridge the gap between the cost of a home and the amount that many low-income households can raise through formal financing.“PMAY provides a subsidy of Rs 2.5 lakh and if the houses constructed in Titwala, Kalyan etc cost anywhere between Rs 12 lakh and Rs 15 lakh,” Jaiswal said, adding that the remaining amount often becomes difficult for beneficiaries to finance.The issue is compounded in Mumbai and the MMR by high land prices, which make affordable housing projects considerably more expensive than in other parts of the state. As a result, even with government assistance, the cost of a dwelling can remain beyond the borrowing capacity of the intended beneficiaries, said Jaiswal.According to him, a significant section of potential beneficiaries earn through informal or irregular employment and therefore do not have the stable monthly income, documented earnings or credit profile required by banks to sanction housing loans. Poor CIBIL scores can further limit their access to formal credit.Around 3 lakh homes have been constructed across Maharashtra under the PMAY scheme.
