By Accommodation Times Bureau
The Ministry of Housing and Urban Poverty Alleviation (HUPA) has launched a Credit Risk Guarantee Fund Scheme with an agreement of countries three nationalized banks, State Bank of India, Central Bank of India and Housing Development Finance Corporation Ltd.(HDFC) to guarantee the risks processing from lending to low income groups and borrowers in the unorganized sectors. This scheme will be regulated by bank regulator National Housing Bank Trust.
The scheme visualizes the creation of the Credit Risk Guarantee Fund Trust with an initial collection of a whooping Rs.60, 000 crore. Ajay Maken, Minister for Housing and Urban Poverty Alleviation announced the scheme also present were NHB chairman R.V. Verma and MoHUPA secretary.
The scheme goes like this; it will guarantee housing loans made by lending institutions like commercial banks, regional rural banks, housing finance companies, co-operative housing societies etc. once they get into an agreement with NHB. Loans not exceeding Rs. 5 lakh shall made available without any collateral or any third party guarantee. Loans can be taken for home improvement, construction, acquisition and purchase of new or second hand dwelling units of size 430 sq ft area. Beneficiaries will be for new or existing individual borrowings for the economically backward sections. R.V. Verma, NHB chairman said,’’ there is shortfall of about 18.5 millions houses within the country, there is a huge demand for housing. This measures would definitely ensures that millions in this segment of home buyers will get affordable housing. A fund like this would easy access to funds.
To bring for the economically weaker sections and low income segments new provision has also been introduced. One among them is providing 35% of project more Floor Area Ratio (FAR) for new projects that would enlarge scale of development.