RBI doubles home loan limit to Rs. 10 lakh to promote housing for low income groups
The RBI has doubled the limit for home loans from Rs 5,00,000 to Rs 10,00,000 for consideration under Priority Sector Lending. This move was taken by RBI in a bid to encourage housing for low income groups in key cities. The RBI has been decided to increase thiss limit for the bank loans extended to non-governmental agencies, approved by the National Housing Bank (NHB) for their refinance, for on-lending for the purpose of construction or reconstruction of individual dwelling units or for slum clearance and rehabilitation of slum dwellers.
- As per the existent norms, banks have to offer 40% of the total credit to the prescribed priority sectors including housing for weaker section.
- Loans of such nature fall under indirect finance to housing sector as the final disbursement is done through NHB approved non-governmental agencies.