Bankers panel recommends hike in housing grant for rural poor to Rs75,000

A high-level committee of bankers constituted by the government has recommended a hike in the grant for construction of rural housing units for below poverty line households (BPL) to Rs75,000 per dwelling unit against the current Rs45,000 per dwelling unit.

The committee has also suggested a loan of up to Rs50,000, at an affordable rate of 4 per cent, to be provided under differential rate of interest (DRI) scheme of the government.

The committee has also recommended an extension in the repayment period of the loan to 15 years and limiting the EMI on such housing loans to Rs300-350, which, it felt, would be within the repayment capacity of the borrower.

Chairman of the bankers committee and chairman of Central Bank of India R Sridhar submitted the report to union minister for rural development and panchayati raj Vilasrao Deshmukh today. The minister said his ministry is committed towards providing affordable houses to the rural poor across the country and that it would examine the recommendations.

For families above poverty line, the committee has recommended non-subsided loan for construction of houses in rural areas, the amount of which may be decided by the lending institution based on the credit worthiness of the borrower.

However, the same may not exceed Rs4 lakh with the interest range of 7-10 per cent. For the purpose, the PLIs especially the banks need to devise a suitable scheme.