RBI Update: Enhancement in Individual Housing Loan limits and credit to Commercial Real Estate - Residential Housing (CRE-RH)

It has been decided to revise the limits on residential housing loans sanctioned by rural co-operative banks to an individual borrower as under:

Category of the bank Existing Limit (per individual borrower) Revised Limit (per individual borrower) (a) StCBs/DCCBs having assessed net worth less than ₹100 crore ₹20 lakh ₹50 lakh (b) StCBs/DCCBs having assessed net worth equal to or more than ₹100 crore ₹30 lakh ₹75 lakh

It has been decided to allow StCBs and DCCBs to extend finance to Commercial Real Estate-Residential Housing (CRE-RH) within the existing aggregate housing finance limit of 5% of their total assets. For this purpose, CRE-RH shall consist of loans to builders/developers for residential housing projects (except for captive consumption). Such projects should ordinarily not include non-residential commercial real estate. However, integrated housing projects comprising some commercial space (e.g. shopping complex, school, etc.) can also be classified under CRE-RH, provided that the commercial area in the residential housing project does not exceed 10% of the total Floor Space Index (FSI) of the project. Standard asset provision of 0.75% and risk weight of 75% shall be maintained for CRE-RH advances. Banks shall have a Board-approved policy for financing CRE-RH and a review note on the performance of the CRE-RH portfolio shall be placed before the Board at least on a half-yearly basis.

The above instructions will come into effect from the date of this circular.

For Further : View Circular