In order to protect banks from defaults in housing loans up to Rs 5 lakh, the Government intends to set up a new dedicated credit guarantee fund. The formal guidelines are likely to be issued by December.
The proposed fund will reimburse up to 90 per cent of the outstanding amount defaulted in case of a loan up to Rs 2 lakh. If the defaulted loan account size is between Rs 2 lakh and Rs 5 lakh, 85 per cent of the outstanding amount will be provided, the official said.
A senior Government official told
The Department of Financial Services under the Ministry of Finance is involved in discussions on this proposal, the official added.
The size of a lower income group house should be 40 sqm and for the economically weaker sections it should be 25 sqm. The official clarified that all the banks, whether public or private, are expected to be brought under the proposed fund.
The Rajiv Awaas Yojana is planned to make the country slum-free. It was launched on June 2 this year with a budget of Rs 5,000 crore. The scheme is expected to initially cover about 250 cities across the country by 2017. The selection of cities will be done in consultation with the Centre.
Under the scheme, half the cost of provision of basic civic and social infrastructure and amenities and of housing, including rental housing, and transit housing for in-site redevelopment in slums would be borne by the Centre, including operation and maintenance of assets created under this scheme.
For the North Eastern and Special Category States, the share of the Centre would be 90 per cent including the cost of land acquisition, if required.
Shishir.s@thehindu.co.in