Realty Firms Can Now Raise $1billion Overseas
Bangalore: Developers and housing finance companies can now raise funds from abroad to develop low-cost housing projects. The Reserve Bank of India (RBI) has permitted this move under the affordable housing scheme, where developers and finance companies can take loan of around $1 billion in 2012-13, said RBI in a notification. Moreover, RBI stated that the borrowing limit will be reviewed each and every year, reports Economic Times.
Developers can only avail this fund raising allocation from abroad when they have minimum of five years market expertise in residential project segment and who have never failed to meet any financial commitments to banks as well as to any other agencies.
Also, the project under affordable housing scheme for which developers will raise fund, should be free from any kind of litigation and dispute. RBI has also made a binding rule for developers where the project need to have confirmed master plan or development plan of the area.
“The layout should conform to the land use stipulated by the town and country planning department for housing projects,” said RBI. “All necessary clearances from various bodies including revenue department with respect to land usage/environment clearance, etc are available on record,” added RBI.
And, housing finance companies to avail this overseas fund raising scheme have to enroll with the National Housing Bank and hold a minimum capital of 50 crore, said RBI. Adding to it, the bad loans of such finance companies should not surpass the net advances of 2.5 percent and over the last three years, the companies need to have net owned funds of almost 300 crore, to raise fund overseas.