On 13th April 2021,National Housing Bank (NHB) has launched Rs.10,000 crore ‘Special Refinance Facility-2021’ (SRF-2021) Scheme for Housing Finance Companies (HFC) and Primary Lending Institutions (PLI) .
i.The main objective of this scheme is to provide liquidity Support to HFCs and eligible PLIs by providing short term refinance support.
ii.Under this SRF, NHB has decided to provide short term liquidity support to PLIs.
iii.This scheme also gives support to HFCs to maintain a constant growth in the housing finance sector.
- All PLIs who have availed financial assistance under SRF/ ASRF including any other eligible PLI (HFCs/ RRBs/ SFBs/ SCBs as eligible for Refinance under LRS) with a maximum net NPA of 7.5% and a minimum of 51%ratio of individual housing loans to total assets (as under Liberalised Refinance Scheme(LRS) for HFCs) are eligible.
- The period of loan is one year from the date of draw down and it has to be repaid in 4 equal quarterly installments or before it.
- The interest rate will be based on the repo rate and is as same as repo rate plus the rating spread and it has to be paid on quarterly basis along with installment.
- The maximum value of refinance will be 20% of the net owned fund of the PLI as on 31.03.2020/ NHB or Rs.2000 crore, whichever is lower.
- Only standard accounts will be considered as security for refinancing
This initiative is in line with Reserve Bank of India’s(RBI) Rs.10,000 crore Special liquidity Facility-2(SLF-2) provided to NHB in accordance to the recent increase of covid-19 cases.
Also in 2020 NHB had provided Rs.10,000crore SRF that was granted by RBI under the Atmanirbhar Bharat Abhiyaan. During the period April 1, 2020 to March 31, 2021, NHB has extended an amount of Rs.42,823.93 crore as refinance to PLIs.
About National Housing Bank(NHB):
Establishment: July 9, 1988
Headquarters: New Delhi
Managing Director: Sarada Kumar Hota