Difficulty in identification of borrowers and delay by PSBs led to poor performance of rural poor to the scheme, the rural development ministry said.

Difficulty in identification of borrowers eligible for rural housing interest subsidy scheme (RHISS) and delay by public sector banks in entering into an agreement with the National Housing Bank has resulted in poor utilisation of funds and weak response from the rural poor to the scheme, the rural development ministry said.

“Total subsidy disbursed under the scheme till January 14, 2021 is Rs 12.20 crore as against the initial allocation of Rs 48.54 crore for the scheme on July 31, 2019,” rural development minister Narendra Singh Tomar said in response to a question in Lok Sabha on Tuesday.

Citing the reasons for poor utilization of funds and weak response from the rural poor, minister Tomar said, “major public sector banks like State Bank of India, Punjab National Bank, Canara Bank, UCO Bank and Indian Bank have not entered into an MoU with NHB”.


“As the subsidy needs to be extended to beneficiaries who are not part of the permanent wait list of Pradhan Mantri Awas Yojana - Gramin, identification of such borrowers is difficult,” it said .

“Further, unavailability of credit guarantee is affecting the off-take of the scheme through regional rural banks (RRBs) as they are reluctant to sanction loans without credit guarantee,” the minister added.

In order to realize the objective of “Housing for All” by 2022, the government announced the Rural Housing Interest Subsidy Scheme (RHISS) in January 2017. Under the scheme, interest subsidy at the rate of 3% on the principal loan amount is given subject to a ceiling of Rs 38,359.

The interest subsidy is admissible for a maximum loan amount of Rs 2 lakh for 20 years or full period of loan whichever is less.

The National Housing Bank (NHB) is the central nodal agency (CNA) to channelize the subsidy to the lending institutions and to monitor the scheme implementation.