Liberalised norms to benefit home loan seekers



Liberalised norms to benefit home loan seekers

The relaxation of norms by way of securitisation of loans by NBFCs and other related liberalised norms, by the Reserve Bank of India, will help NBFCs and Housing Finance Companies (HFCs)offering mortgage loans, in turn benefiting home loan seekers.

As per the new norms, NBFCs can now securities loans of more than five year maturity after holding these assets for at least one year. The relaxation on the minimum holding period will be available when the NBFC retains 20% of the book value of these loans. The other measures taken by the RBI include allowing banks to raise more against the collateral of government securities for on-lending to NBFCs and HFCs, besides steps for partial credit enhancement to aid bond raising by NBFCs. In addition to this RBI has facilitated asset and risk transfers within the financial system.

Says Pradeep Aggarwal, Chairman, Signature Global, ” These are timely and welcome measures to boost liquidity. The liberalised securitisation facility will especially benefit medium and small companies. Recently, NBFCs which had emerged as a major source of funding to both home buyers and developers, faced liquidate crisis, thereby affecting both home buyers and developers. But these recent measures will help ease liquidity pressures”.

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