The National Housing Bank (NHB) is infusing an additional Rs 10,000 crore in NBFCs from Friday with a view to improve flow of funds for housing loans, said a finance ministry statement.
"To further ease flow of funds to the housing sector, the NHB is making available from today, a liquidity infusion facility of Rs 10,000 crore for Housing Finance Companies (HFCs) as additional liquidity for individual housing loans, for affordable housing," the statement said.
This facility will be over and above the existing finance schemes of the housing sector regulator NHB.
The statement further said subsequent to the budgetary announcements, the RBI has unveiled a slew of measures for banks to avail additional liquidity of Rs 1.34 lakh crore.
"Now...the backstop guarantee to banks for NBFC portfolios taken over by them has become effective. Banks will be utilising this guarantee support as per the contours of the scheme," it said.
Finance Minister Nirmala Sitharaman had announced in the Budget that the government would provide one-time six months partial credit guarantee to public sector banks for the "first loss of up to 10 per cent" to enable them purchase pooled assets of financially sound NBFCs amounting to Rs 1 lakh crore.
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"This would ease the liquidity stress in the NBFC sector and increase the access of these NBFCs to bank finance, and, in turn, enable them to continue to play their role in meeting the financing requirement of the productive sector of economy," the ministry added.
Meanwhile, the government has received a proposal from the Reserve Bank on the draft modalities of the guarantee to operationalise the Budget announcement.
The ministry further said the government has accorded its approval to the modalities that would be set in motion by the RBI.
"The Department of Financial Services would put in place an oversight mechanism for the scheme," it added.
The NBFC sector has been facing liquidity issues after one of the largest shadow banks in the country, IL&FS Group defaulted on loan payment.