RBI relaxes PSL norms for housing loans from RRBs and SFBs

Individual housing loan limits for eligibility under PSL raised to Rs 35 lakh in metro centres and Rs 25 lakh in other centres

In order to bring the RRBs and SFBs at a level playing field with other Scheduled Commercial Banks, the Reserve Bank of India has decided to enhance the housing loan limits for eligibility under priority sector lending (PSL) in respect of RRBs and SFBs for individuals up to Rs 35 lakh in metropolitan centres (with population of ten lakh and above) and Rs 25 lakh in other centres, provided the overall cost of the dwelling unit in the metropolitan centres and at other centres does not exceed Rs 45 lakh and Rs 30 lakh.

Earlier, loans to individuals up to Rs 20 lakh for purchase/construction of a dwelling unit per family provided the overall cost of the dwelling unit does not exceed Rs 25 lakh were eligible to be classified under priority sector. In terms of the Compendium for SFBs, loans to individuals up to Rs 28 lakh in metropolitan centres (with population of ten lakh and above) and Rs 20 lakh in other centres, were eligible to be classified under priority sector, provided that the cost of dwelling unit does not exceed Rs 35 lakh and Rs 25 lakh, respectively.

 

Furthermore, the existing family income limit of Rs 2 lakh per annum eligible for loans to housing projects exclusively for the purpose of construction of houses for Economically Weaker Sections (EWS) and Low Income Groups (LIG), is revised to Rs 3 lakh per annum for EWS and Rs 6 lakh per annum for LIG, in alignment with the income criteria specified under the Pradhan Mantri Awas Yojana.

Accordingly, the RRBs/SFBs are allowed to reckon their outstanding portfolio of housing loans meeting the revised criteria for classification under priority sector lending from the date of circular. All other terms and conditions specified under the Master Direction/Compendium shall remain unchanged.

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