PM Surya Ghar Muft Bijli Yojana: Know Bank Loans For Rooftop Solar Panel Installation

PM Surya Ghar Muft Bijli Yojana is now inviting applications to provide 300 units of free monthly electricity to 1 crore households. The Centre gives subsidies up to Rs 78,000 but it depends on the capacity of solar panels one installs. If the householder can't afford the remaining amount, he or she can get a loan from the bank. Rooftop solar PV systems can be installed on any type of roof having sufficient load-bearing capacity. On a clear sunny day, a 1 kW solar power plant can generate 4 to 5.5 units in a day.

How Much Is Scheme Subsidy?

PM Surya Ghar Muft Bijli Yojana aims to boost rooftop solar installations with subsidies of up to Rs. 78,000. This is for larger systems exceeding 3 KW and for households consuming more than 300 units per month. For solar panels with capacities up to 2 KW, households can avail of a subsidy of Rs. 30,000 per kilowatt, and Rs 18,000 per KW for additional capacity up to 3 KW.

Applicants can register online at https://pmsuryaghar.gov.in/consumerRegistrationl Eligible households can apply online for installation, await feasibility approval from the distribution company (DISCOM), then install the plant and receive subsidies within 30 days of installation. Just make sure that the electricity connection and bank account are in the name of the applicant, or else the application will be rejected.

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Bank Loans & Interest Rates

Banks across India are extending loan facilities under the 'PM – Surya Ghar: Muft Bijli Yojana' to incentivise the adoption of solar energy solutions among residential consumers. Most of the below banks are providing loans on reducing interest rates which means interest is calculated on diminishing principal amounts. Every month when you pay your EMI, your principal loan amount decreases. And, when you opt for the reduced interest rate, the interest will be calculated only on the reduced principal amount at the time of EMI payment. In some banks, it is categorised as a residential category, in some under a personal category and some in a composite category along with home loan.

State Bank of India (SBI) offers a loan scheme called 'Solar Roof Top Finance Scheme for residential purposes', in which individuals can avail loans of up to Rs 10 lakh with a maximum repayment tenure of 5 years. The interest rates, which range from 9.65 per cent to 10.65 per cent, are based on the applicant's CIBIL score.

Union Bank provides 'Union Roof Top Solar Scheme (URTS)' for the installation of grid-connected RTS (Roof Top Solar) systems up to 25 KW plant to individuals having existing independent houses. The loan amount is allowed up to 80 per cent of the project cost or up to 15 lakh, whichever is less.

A maximum of 84 EMI repayments is allowed, and the interest rates are determined based on the applicant's CIBIL score, starting from the External Benchmarks Lending Rate (EBLR+2.10 per cent).

Canara Bank offers the Housing-cum-Solar Loan. The loan amount is a maximum of Rs 10 lakh, with maximum repayment tenure of 20 years. The loan option falls under the Residential or Composite category Loan, so individuals can only get loans for on-grid installation of Roof Top Solar Photovoltaic (PV) System along with the housing loan. The interest rates range from 11 per cent to 12.5 per cent per annum.