RBI announces measures to boost credit flow to real estate sector

The requirement of standard asset provision of 0.25 per cent will continue to apply on all such loans, the notification added

In a bid to increase flow of credit to the real estate sector, the Reserve Bank on Friday rationalised the risk weightage to LTV (loan to value) ratio for all new housing loans sanctioned up to March 31, 2022.

As per a notification issued by the RBI, new housing loans will attract a risk weight of 35 per cent where LTV is less than 80 per cent and a risk weight of 50 per cent where LTV is more than 80 per cent but less than 90 per cent.

This measure, according to the RBI, is expected to give a fillip to