Page 20 - Banking Finance July 2022

RBI relaxing Coop bank urban cooperative banks to provide trict cooperative banks to extend fi-
doorstep banking facilities to custom- nance to commercial real estate - resi-
lending norms to give a
ers. "With this decision, cooperative dential housing within the existing ag-
boost to Centre's afford- banks will get a level playing field in the gregate housing finance limit of 5 per-
competitive banking sector and they cent of their total assets.
able housing plan
will be able to provide door-to-door
Union Cooperation minister Amit Shah
banking facilities to customers like Home loan limit doubles
said the RBI's decision to relax norms
other banks," he added.
for cooperative banks for home loans for individual borrowers in
will provide a momentum to the
Co-operative Banks permit- co-operative banks
government's goal of providing afford-
RBI has increased the upper limit of
able housing for people. ted more activities at par
home loan amount by at least 100%
Referring to the RBI decision to allow with commercial banks
for the individual borrowers of Primary
Rural Cooperative Banks (RCBs) to lend
Co-operative banks will be eligible for (Urban) Cooperative Banks (UCBs) and
to the commercial real estate and resi-
more services at par with commercial Rural Cooperative Banks (RCBs - State
dential housing sector, the minister banks. Besides, enhancing limits on Cooperative Banks and District Central
said: "With this decision, the scope of housing loans, they will be allowed to Cooperative Banks).
our rural cooperative banks will in- lend to commercial real estate. Be-
The revision of these limits has hap-
crease. Along with this, the resolution sides, urban cooperative banks will also
pened after a gap of 11 years as these
of giving affordable houses to people be allowed to offer door-step banking
were last revised for UCBs in 2011 and
will also get momentum". services to their customers.
for RCBs in 2009. According to the
Among other key decisions, the RBI has "Taking into account the increase in announcement made by RBI, for Tier-
doubled the limit of individual housing housing prices, it has been decided to I UCBs the previous limit was Rs 30 lakh
loans for urban cooperative banks and increase the existing limits on indi- which has now been revised to Rs 60
more than doubled for rural cooperative vidual housing loans by cooperative lakh. Similarly, for Tier-II UCBs the limit
banks. The individual housing loan limit banks" the Reserve Bank said in its has been increased from Rs 70 lakh to
for tier-I urban cooperative banks (UCBs) statement on regulatory and develop- Rs 1.4 crore.
has been increased from 30 lakh to 60 mental policies.
"This is a welcome move considering
lakh, for tier-2 UCBs from 70 lakh to 1.40
Also, considering the growing need for that limits were last revised almost a
crore and RCBs limit has been increased
affordable housing and to realise their decade ago and with the increase in
from 20 lakh and 30 lakh to 50 lakh and
potential in providing credit facilities housing and real estate prices, increas-
75 lakh, respectively, he said.
to the housing sector, the RBI has to ing the limit was needed. This would
The minister said, the RBI has allowed allow State cooperative banks and dis- give some uplift to the affordable hous-

20 | 2022 | JULY | BANKING FINANCE