RBI revises housing loan limits under Priority Sector Lending

Jun 21, 2018 08:20 IST
RBI revises housing loan limits under Priority Sector Lending

The Reserve Bank of India (RBI) on June 19, 2018 revised the upwards housing loan limits under Priority Sector Lending (PSL).

The housing loan limits were revised to bring union of the PSL guidelines for housing loans with the Affordable Housing Scheme of the Union Government and to give a stimulus to low-cost housing for the economically weaker sections and low income groups.

PSL loans are relatively cheaper than market interest rate.


• Housing loans of up to Rs 35 lakh for residences costing less than Rs 45 lakh will now be treated as Priority Sector Lending (PSL) to give a boost to the low-cost segment.

• The housing loan limits for eligibility under priority sector lending will be revised to Rs 35 lakh in metropolitan centres and to Rs 25 lakh in other centres.

• However, for being classified as priority sector, the overall cost of the residence in the metropolitan centre (with population of 10 lakh and above) and at other centres should not exceed Rs 45 lakh and Rs 30 lakh, respectively.

• The existing family income limit of Rs 2 lakh per annum for availing of the loans for housing projects for Economically Weaker Sections (EWS) and Low Income Groups (LIG) now stands revised to Rs 3 lakh per annum and Rs 6 lakh per annum, respectively.

• These changes have been done in alignment with the income criteria specified under the Pradhan Mantri Awas Yojana (PMAY).


Till now, home loans to individuals of up to Rs 28 lakh in metropolitan centres and Rs 20 lakh in other centres was classified under priority sector, provided that the cost of dwelling unit does not exceed Rs 35 lakh and Rs 25 lakh, respectively.

Pradhan Mantri Awas Yojana (PMAY)



  • The Pradhan Mantri Awas Yojana was launched in 2015.
  • The scheme is being implemented in 3 phases, out of which, the first phase has been completed successfully.
  • The scheme aims to ensure that people from rural & urban areas get their own home and provides financial assistance through different components.
  • There is no age limit to avail of the scheme. However, the eligibility of the applicants has been categorised into 6 different groups:
    • Economically Weaker Section (EWS)
    • Light Income Group (LIG)
    • Medium Income Group 1 (MIG 1)
    • Medium Income Group 2 (MIG 2)
    • Minorities
    • Women

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