[URBAN HOUSING]

URBAN HOUSING
CLASS NOTES
 UNIT-I

HOUSING ISSUES -INDIAN CONTEXT

HOUSING

HOUSING is a State subject. The Union Government is, however, responsible for the formulation of
policy with regard to programme and approaches for effective implementation for social housing
schemes, particularly those pertaining to weaker sections of the society.

THE ROLE OF HOUSING

Macroeconomic stability and the housing sector are inextricably linked. It is estimated that for every
Indian rupee (INR) invested in housing, INR 0.78 is added to the country’s GDP gross domestic product
of the country. The housing sector has strong linkages to over 250 ancillary industries. After agriculture,
the housing and real estate industry is the second largest employment generator in India.

It is estimated that the construction sector provides direct employment to 16 per cent of the country’s
workforce, which is growing at a rate of seven per cent per annum. The housing sector alone accounts for
58 per cent of workers in the construction sector. However, nearly 55 per cent of these workers are in the
unskilled category.

OVERVIEW OF HOUSING IN INDIA

The need to provide affordable housing has been the reason behind State interventions in the sector.
Housing policies,however, tended to be framed by the government from a social rather than economic
perspective. Despite explicit recognition of the need for housing,dedicated programmes have only
benefited from low public spending. Housing and subsidies have largely synonymous with each other,
hence a tendency to view housing finance from the angle of the government’s cash budget, rather than as
a developmental activity with tremendous spin-offs to the economy.

The Strategy was to ensure social, economic and environmental sustainability while simultaneously
upgrading living conditions. That it sought to involve national governments, private bodies as well as
non-governmental organisations in formulating housing programmes.

This provided the Indian government with the impetus to draft its first National Housing Policy, which
was tabled in Parliament in 1992 and adopted in August 1994. Subsequently, with a national agenda of
‘shelter for all’,a new Housing and Habitat Policy was adopted in 1998.

TRENDS IN POPULATION RISE AND URBANISATION IN INDIA

Since population and demographic changes largely determine housing needs, it is important to look at
various trends and emerging patterns, particularly in terms of urbanisation.

INDIA’S HOUSING SHORTAGE

Official and up-to-date statistics on the shortage of housing units in the entire country are not readily
available. According to the National Buildings Organisation (NBO), the factors behind the housing
shortage include

 an excess of households over available houses, including homeless households

 congestion
 replacement or upgrading of unserviceable houses and
 obsolescence/ replacement of old houses.

Despite the absence of reliable statistical information,a growing population and sustained urbanisation
have kept the available housing stock under increasing pressure. As per the Planning Commission
estimates, the total urban housing requirement during the 10th five- year plan (2002-2007), was 22.44
million dwelling units in urban areas.

This comprises two components: an urban housing backlog of 8.89 million dwelling units (early 2002
estimate), and an addition of 13.55 million new dwelling units.

HOUSING CONDITIONS IN INDIA

Housing conditions are a key indicator of socio-economic development. India’s National Sample Survey
Organisation (NSSO) uses three classes, known as
 katcha
 semi-pucca and
 pucca to differentiate between the types of homes in India.

A katcha house is built

with non- durable
materials like unburnt
bricks, mud, thatch, leaves
and bamboo. A
pucca house is one built
with permanent
materials like oven-burnt
bricks, concrete, stone
blocks, cement, iron or
other metal sheets and timber. A semi-pucca house is built with both katcha and pucca materials.

NATIONAL HOUSING POLICIES -“Housing for All”

NATIONAL HOUSING AND HABITAT POLICY-1998

In 1994, India adopted the National Housing Policy (NHP), which recognises the key role of the
Government as facilitator rather than provider of housing services. The National Housing & Habitat
Policy-1988 (NH&HP) is a continuation of the NHP. It calls for a housing revolution in the country
and focuses on the changed roles of various stakeholders in the housing development process in the
new economic environment of liberalisation and globalisation. The policy emphasises the need to
persuade the private and cooperative sectors to take greater initiatives in the promotion and
development of housing through fiscal concessions and other incentives. Though the move towards
disassociation of governmental agencies from direct construction is being witnessed since the early
70s, the NH&HP calls for a continued positive role by the Government in housing of the poor. Rapid
growth of population and increased urbanisation on one hand and escalating land prices on the other
are responsible for widening the gap between demand for and supply of housing units. These factors
squeeze the poor off land and marginalise them in urban housing markets. Recognising this, the
NH&HP suggests a number of areas of intervention for governmental agencies to promote affordable
housing for the poor, including availability of sites, housing loans at below-market rates, low-cost
building materials and civic services.
The broad aims of the National Habitat and Housing Policy-1998 (NH&HP) are:
􀂃Creation of surpluses in housing stock either on rental or ownership basis;
􀂃Providing quality and cost-effective housing and shelter options to the citizens, especially the
vulnerable groups and the poor;
􀂃Guiding urban and rural settlements to ensure planned and balanced growth and a healthy
environment;
􀂃Making urban transport as an integral part of the urban Master Plan;
􀂃Using the housing sector to generate more employment and to achieve skill upgradation in
housing and building activities;
􀂃Promoting accessibility of dwelling units to basic facilities like sanitation and drinking water;
􀂃Removing legal, financial and administrative barriers for accessing land, finance and
technology for housing;
􀂃Forging strong partnerships between private, public and co-operative sectors in housing and
habitat projects.

1.VALMIKI AMBEDKAR AWAS YOJANA (VAMBAY)

 The rationale is to provide financial assistance towards improving the living conditions of
urban slum dwellers below the poverty line. Importantly,VAMBAY beneficiaries are
given a freehold land title to their property, ensuring that the recipients are granted a
sense of security.
 Under the VAMBAY scheme, funds are available for the upgrading of existing units or
for the construction of alternative dwelling units. A separate component also caters to
basic amenities such as sanitation and water supply. The amount allocated for the
building of a new house ranges from INR 40,000 to INR 60,000 depending on the
population of the city.
  Half of the sanctioned amount is provided by the central government and the balance is to
be matched by the relevant State government.

2.URBAN REFORMS INCENTIVE FUND

 Government is keen to have reforms in the urban sector.

 creation of an Urban Reforms Incentive Fund with an initial allocation of Rs. 500 crore to
provide urban reform linked assistance to State/Union Territories.
 In the first phase, seven reforms e.g. Repeal of Urban Land Ceiling and Regulation Act,
Rationalisation of Stamp Duty, Reforms of Rent Laws, etc., were identified

3. INTEGRATED HOUSING AND SLUM DEVELOPMENT PROGRAMME

 In cities/towns not covered under BSUP(basic services to urban poor), an Integrated Housing and
Slum Development Programme is implemented.
 Central share in the form of Additional Central Assistance as full grant
 80 per cent of the project cost borne by the Central Government
 90 per cent of the project cost borne by the Central Government for projects from
cities/towns in special category States
 A minimum of 12 per cent beneficiary contribution for houses. For SC/ST/BC/OBC/PH and other
weaker sections, 10 per cent beneficiary contribution
 Reforms to ensure improvement in urban Governance.
 Cities/towns to prepare and submit Detailed Project Reports.

4. BASIC SERVICES TO THE URBAN POOR (BSUP)

 50 per cent of the project cost in respect of cities having million plus population or above to be
borne by the Central Government
 90 per cent of the project cost borne by the Central Government for projects from cities/towns in
North Eastern States and Jammu & Kashmir.
 80 per cent of the project cost borne by the Central Government for projects from the remaining
cities
 A minimum of 12 per cent beneficiary contribution for houses. For SC/ST/BC/OBC/PH and other
weaker sections, 10 per cent beneficiary contribution

5. SWARNA JAYANTI SHAHARI ROZGAR YOJANA

All the three Urban Poverty Alleviation schemes, namely, Urban Basic Services for the Poor (UBSP),
Nehru Rozgar Yojana (NRY) and Prime Minister’s Integrated Urban Poverty Eradication Programme
(PMI-UPEP) stand subsumed in a new scheme Swarna Jayanti Shahari Rozgar Yojana (SJSRY)

The SJSRY seeks to provide gainful employment to the urban unemployed or under-employed through
encouraging the setting up of self-employed ventures or provision of wage employment. This programme
relies on creation of suitable community structures.The Centre and the States fund the Yojana on a 75:25
basis. The scheme consists of two special programmes

(a) the Urban Self-Employment Programme (USEP )

(b)the Urban Wage Employment Programme (UWEP)
Urban Self-Employment Programme

This Programme has three components:

(i) Assistance to individual urban poor beneficiaries for setting up gainful selfemployment Ventures

(ii) Assistance to groups of urban poor women for setting up gainful self-employment ventures. This sub-
scheme is titled as “The Scheme for Development of Women and Children in the Urban Areas
(DWCUA)”

(iii)Training of beneficiaries, potential beneficiaries and other persons associated with the urban
employment programme for upgradation and acquisition of vocational and entrepreneurial skills.

This scheme is not applied to beneficiaries educated beyond the ninth standard

Urban Wage Employment Programme

This programme seeks to provide wage employment to beneficiaries living below the poverty-line within
the jurisdiction of urban local bodies by utilising their labour for constructing of socially and
economically useful public assets. There are no restrictions on educational qualification .

The material/labour ratio for works under this programme is to be maintained at 60:40. The prevailing
minimum wage rate, as notified from time to time for each area, has to be paid to beneficiaries under this
programme. The programme is dovetailed with the state sector Environmental Improvement of Urban
Slums (EIUS) scheme as well as the National Slum Development Programme (NSDP).

6.BUILDING MATERIAL AND TECHNOLOGY PROMOTION COUNCIL

The Government is encouraging use of innovative, cost-effective, energy efficient and green technologies
in housing and other building construction.
In this context, the following initiatives are taken

 Action plan for propagation of new technologies in housing sector is drawn up

 . The Building Materials and Technology Promotion Council (BMTPC) isfunctioning as a
registered society under the aegis of Ministry of Housing andUrban Poverty Alleviation,
Government of India, to provide an appropriateplatform for technology identification, validation,
transfer, application in theshelter sector and promoting large-scale of commercial production of
innovative,energy efficient, environment-friendly green building materials.
 The Councilhas taken a lot of initiatives in development and promoting cost-effective
environment friendly building materials based on utilisation of agro-industrial wastes,
introduction of new specifications in the schedule of rates by CPWD, formulation of national
standards by Bureau of Indian Standards and increasing the entrepreneurs interface with financial
institutions and research agencies. A number of fly ash based building material production units
invarious parts of the country have been set up.
 In order to increase the productivity and quality of building components,different type of easy to
operate machines have been developed by BMTPC.
 BMTPC is operating Performance Appraisal Certification Scheme for new building materials and
technologies
  The scheme aims to provide the user means for informed choice of new innovative materials
through well defined process of appraisal. It generatesnecessary data for formulation of national
standard by the Bureau of Indian Standards
 Some of technologies and new materials and components already tested and manufactured on a
pilot scale are identified for large-scale extension whilesome have been given license for
commercial productions such as Bamboo Mat Corrugated Roofing Sheets, Fly Ash/Red Mud
Polymer Door Shutters, Coir Polymer Composites, Biogases Board, etc.
 A network of Building Centers was setup as a Centrally-sponsored scheme through HUDCO to
train artisans and others for transfer of appropriate technology to rural and urban areas. As on 31
March 2006, administrative approval has been given for 655 Building Centers.
 These Centers are doing good work in propagation and promotion of innovative cost-effective
building materials and technologies.
 Non-Governmental Organisations are increasingly being supported to supplement governmental
efforts.
 BMTPC is now engaged in exporting innovative technologies and machineries developed in
India, to African and Latin American Countries

7.NATIONAL SLUM DEVELOPMENT PROGRAMME

The objective of this programme was upgradation of urban slums by providing physical amenities like
water supply, storm water drains, community bath, widening and paving of existing lanes, sewers,
community latrines, street lights, etc. Besides, the funds under NSDP could be used for provision of
community infrastructure and social amenities like pre-school education, non-formal education adult
education, maternity, child health and primary health care including immunisation, etc. The programme
also had a component of shelter upgradation or construction of new houses.

8.2MILLION HOUSING PROGRAMME

The Two Million Housing Programme was launched by the Government in the year 1998-99 with the
objective of providing ‘housing for all’ with emphasis on weaker section and the low income groups. As a
part of the Two Million Housing Programme HUDCO was assigned a target of 10 lakh units annually (six
lakh units in rural areas and four lakh units in urban areas).

9.NATIONAL POLICY ON STREET VENDORS

Street Vendors constitute an integral part of our urban economy. They provide essential services to
consumers, create their own self-employment and at the same time contribute to the economic growth of
the city. Despite these, street vendors have not yet been recognised as part of the system. They are not
included in the town plans and the municipal policies. Therefore, they remain insecure leading to increase
in poverty and unemployment. Law and order problems also increase leading to inequalities and
disharmony in the cities. The State Governments were requested for its suitable and appropriate adoption
in overall interest of Urban Street Vendors, with or without any change, to suit local conditions and also
respecting any court decisions, which may impinge on the issue.

10. NATIONAL SCHEME OF LIBERATION AND REHABILITATION OF SCAVENGERS AND

THEIR DEPENDENTS

The Scheme provides both for training and rehabilitation. For training, stipend upto Rs. 500 per trainee
per month upto six months in the age group of 15 to 50 years is provided.
 Rehabilitation of scavengers is attempted through sanction of projects costing up to Rs 50,000 for each
beneficiary comprising 50 subsidy subject to a ceiling of Rs 10,000 per project.Balance 50% loan

IMPORTANT ABBREVATIONS

BSE Bombay Stock Exchange Limited

CBOs Community-Based Organisations
CAGR Compounded Annual Growth Rate
CIBIL Credit Information Bureau (India) Limited
DSAs Direct Selling Agents
EWS Economically Weaker Sections
FCCB Foreign Currency Convertible Bond

GDP Gross Domestic Product

HDFC Housing Development Finance Corporation Limited
HUDCO Housing and Urban Development Corporation Limited

IAY Indira Awas Yojana

VAMBAY Valmiki Ambedkar Awas Yojana
LIG Low Income Groups
LTV Loan-to-Value Ratio
MIBOR Mumbai Inter-Bank Offered Rate
MoEF Ministry of Environment and Forests

NCAER National Council of Applied Economic Research

NGOs Non-Governmental Organisations
NHB National Housing Bank
NSE National Stock Exchange of India Limited
NSSO National Sample Survey Organisation
RBI Reserve Bank of India
SARFAESI Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest
SLR Statutory Liquidity Ratio
ULCRA Urban Land (Ceiling and Regulation) Act, 1976
UN United Nations

HOUSING IN THE FIVE YEAR PLANS

India’s 1st Five-Year Plan (1951-56) introduced housing in the national policy framework. Affordability
was emphasised as the key issue, and government support through subsidies and loans was deemed
necessary. A separate Ministry of Works and Housing was established and the National Buildings
Organisation (NBO) was created. This plan in fact became the benchmark for subsequent Five-Year Plans
over the next two decades.

The 2nd Plan (1956-61) strengthened the schemes laid out in its predecessor through expanded coverage.
However, there was a policy shift as the central government decided to provide assistance to State
governments to develop low-income housing, instead of directly providing loans to low-income groups.
This gave rise to State Housing Boards that are still in existence today.

The 3rd Five-Year Plan (1961-66), followed by a triennial plan (1966-69), together placed emphasis on
planned development and land acquisition, particularly for urban areas. Although both plans continued
the schemes of those before them, they added a focus on the need to target low-income groups. State
Housing Boards’ resources were increased and they were expected to address the housing shortfall in
their respective States.

Despite these efforts, by the 4th Five-Year Plan (1969-74) the government was faced with the dual
problemof a rapidly growing population and a slow-growing housing stock. For the first time, the
government decided to encourage private and co-operative housing schemes by providing financial
assistance. However, the bulk of practical action remained within the public sector. The government also
recognised the need to provide housing finance to low-income groups and accordingly set up the Housing
and Urban Development Corporation (HUDCO) in 1970. HUDCO’s mandate was to provide such groups
with loans below peak interest rates and with longer repayment periods. At the same time, HUDCO also
sought to finance urban development activities to help decongest cities. HUDCO actively bought bonds
floated by various State Housing Boards and sought to provide other forms of financial assistance to them
as well, effectively acting, in the main, as a wholesale lending arm for housing finance.

It was during the 5th Plan (1974-79) that the Urban Land (Ceiling and Regulation) Act (ULCRA) was
adopted. ULCRA sought to prevent concentration of land holdings in urban areas and to make more land
available for equitable disbursal. However, the legislation failed to achieve its goals and the repercussions
are still being felt today. Coincidently, India’s first retail housing finance company, known as the
Housing Development Finance Corporation (HDFC) was set up at that time (in 1977). HDFC sought to
provide financial assistance to individuals, groups and cooperative societies, as well as to companies for
staff housing.

In a move to cope with increasing urbanisation, the thrust of the 6th Plan (1980-85) was on providing
more housing in small and medium-size towns. Efforts were made towards improving living conditions
in the slums while emphasising the need for more support to private groups. During this period, other
housing finance companies also entered the market.

7th Plan (1985-90) This was also when several reforms took place at home and abroad. In 1988 the UN
General Assembly adopted the Global Shelter Strategy, which India endorsed . This gave the country the
impetus it needed to draft its first National Housing Policy. Another major reform, also in 1988, was the
founding of the National Housing Bank. NHB’s mission was to promote and regulate housing finance
companies and to mobilise additional resources for housing. A Building Materials and Technology
Promotion Council was also established. During this period, several housing finance companies were
promoted, but commercial banks still shied away from lending to this type of institution. the plan
“emphasised the need for radical reorientation of all policies relating to housing and argued that the major
responsibility of house construction would have to be left to the private sector, [and] in particular, the
household sector. [Further,] the government should be involved in housing not so much to build but to
promote housing activity”

India’s 8th Five-Year Plan (1992-97) built on the foundations of its predecessor, again acknowledging
that housing-related activities belonged in the private sphere, while recognising that there was room for
State intervention to provide housing to low-income groups. Those were the years when Parliament
endorsed India’s first National Housing Policy (1994). Importantly, the plan recognised that urbanisation
was inevitable, and therefore concentrated resources on upgrading urban centres. The 8th Plan also
recommended reforms of both a financial and a legal nature to allow the mortgage market to develop
further. Special emphasis was on government incentives to enhance the flow of credit to the housing
sector through housing finance institutions.

More recently, both the 9th (1997-2002) and 10th (2003-2007) Plans recommended further reforms to
enable the government to play its role as facilitator and encourage development of the mortgage market.
Particular emphasis was laid on market-friendly reforms in both taxation and infrastructure in a bid to
increase capital spending in housing. Both Plans stressed the need to repeal old legislation, and in 1999
the central government finally abrogated ULCRA. The government also adopted a revised National
Housing Policy in 1998 and prepared another draft in 2005. The 9th and 10th Five-Year Plans also saw
aggressive entry of commercial banks into housing finance.

THE DEVELOPMENT OF THE FORMAL HOUSING FINANCE SYSTEM

Formal housing finance in India first came with the setting up of HUDCO in 1971. HUDCO sought
mainly to cater to low-income groups, but at the same time provided technical and financial assistance to
State Housing Boards, urban development institutions and the co-operative sector.

Private sector involvement in retail housing finance did not begin until the Housing Development Finance
Corporation Limited (HDFC) was established in 1977. HDFC provides housing finance to individuals,
co-operative societies and the corporate sector.

Around the mid- and late 1980s a few housing finance companies were set up either as private limited
companies (e.g., Dewan Housing Finance Limited) or as joint ventures with State governments (e.g.,
Gujarat Rural Housing Finance Corporation) or bank sponsored housing finance companies (e.g., SBI
Home Finance). At that time, even State-owned insurance companies like the Life Insurance Corporation
and the General Insurance Corporation of India set up their own housing finance arms.

With the recognition of the need to develop a network of specialised housing finance companies, also
came the need for a dedicated supervisory agency specialising in the promotion and financial functions
of housing finance, which until then had been in the purview of the Reserve Bank of India.

The National Housing Bank is the principal agency for the promotion and support (including financial) of
housing finance institutions. The 1987 act empowers the National Housing Bank to issue directives to
housing finance institutions in order to ensure sound business growth. NHB can also grant loans and
advances or provide financial assistance to registered banks and housing finance institutions, or to any
such authority established by or under any central, State or provincial act and engaged in slum
improvement. Finally, NHB can devise schemes for the mobilisation of resources and extension of credit
for housing.

THE ROLE OF BANKS IN HOUSING FINANCE

Banks’ housing-related lending takes three distinctforms

(1) direct lending, with banks extending housing
Loans
(2) indirect lending, where banks lend to approved housing finance companies or State housing
boards which on-lend the monies (dues)
(3) investments in securities backed by the mortgages issued by housing finance companies (mortgage-
backed securities or MBSs).

APPROACH TO HOUSING DEVELOPMENT

The governmental agencies, however, played a strong supporting role for the provision of housing
for the poorer sections of society, including allocation of land. Over the years there has been a
gradual shift in the role of the Government from a ‘provider’ to a ‘facilitator’, ensuring access to
developed land, basic services, building materials, technology, construction skills and finance so that
housing can be undertaken as a people's programme. The facilitating approach aims at fostering
strong public-private partnerships with the provision of appropriate incentives to the private sector,
promotion of housing finance institutions, propagation of alternate building materials and
technologies and extension of support to NGOs, CBOs, co-operatives and the private sector.

The Government of India and State Governments have adopted a two-pronged approach to housing
development for the poor in the past, i. e., sites and services and permanent housing. Under sites and
services, basic infrastructure facilities like drinking water, internal roads, approach roads, drainage,
community toilet, etc., were provided to develop layouts. The beneficiaries were also given
construction assistance for erecting a small shelter. The permanent housing programme, which has
replaced sites and services, was initially confined to those beneficiaries who could avail loan facility.
Later, several modifications have come up in the programme to address the housing needs of
different target groups. The broad elements of the approach of the Government of India to tackle the
problem of housing the poor are: special programmes/targeted subsidy to the poor and vulnerable
groups, loan assistance to governmental agencies/beneficiaries at below-market interest rate for
housing and at normal rate for infrastructure through the Housing and Urban Development
Corporation (HUDCO), creation of housing assets as part of employment and income generation
programmes, promotion of cost-effective and eco-friendly building materials and technologies and
creation of an enabling environment for private sector initiative.

HOUSING AND URBAN DEVELOPMENT CORPORATION

The Housing and Urban Development Corporation (HUDCO) was established as a fully-owned
enterprise of the Government of India in 1970 with an equity base of Rs.20 million to function as a
national techno-financial institution to promote housing and urban development. The objectives of
HUDCO include the following:
􀂃To finance and undertake housing and urban development programmes in urban and rural
areas;
􀂃To finance and undertake either wholly or partly, the setting up of new towns or satellite
towns covering infrastructure needs in urban and rural areas;
􀂃To finance and undertake the setting up of building material industries;
􀂃To provide consultancy services for projects of housing and urban development within the
country and abroad.
The key activities of HUDCO include:
􀂃Lending for housing programmes through various schemes such as urban housing, rural
housing, staff rental housing, cooperative housing, working women's housing, housing
schemes through NGOs and CBOs and housing through private builders;
􀂃Lending for urban infrastructure, including land acquisition for projects, integrated land
acquisition and development, city level infrastructure - water supply (rehabilitation,
augmentation, new source development/transmission projects), sanitation (rehabilitation,
augmentation, new sewerage and drainage projects, conversion of dry latrines, construction
of individual and community toilets), solid waste management (collection, conveyance,
treatment and disposal, energy recovery), transportation (roads, bridges, rail and road
transport terminals, airports, ports), etc., social infrastructure (health, education, parks,
playgrounds), commercial infrastructure (shopping centres, commercial complexes, office
complexes), and integrated area development/new township projects, etc.;
􀂃Consultancy services in the field of housing, township development and infrastructure
development;
􀂃Promotion of Building Centres for technology transfer and support to building material
industries; and
 􀂃Training in human settlements and technical assistance to borrowing agencies.

The borrowers of HUDCO are: State Urban Infrastructure Finance and Development Corporations, Water
Supply and Sewerage Boards, Urban Development Authorities, State Housing Boards, National Capital
Region Planning Board (NCRPB), New Town Development Agencies like City and Industrial
Development Corporation (CIDCO), Mumbai, Municipal Corporations/Municipalities, Improvement
Trusts, and private companies and agencies.

NATIONAL HOUSING BANK

The National Housing Bank (NHB), the apex institution of housing finance in India,was set up as wholly
owned subsidiary of the Reserve Bank of India. The bank started its operations from July 1988

The NHB is the regulator and supervisor of Housing Finance Companies (HFCs) in the country. Total
refinance extended by NHB to all housing finance institutions including Housing Finance Companies,
commercial banks and co-operative sector institutions stood at Rs 7500 crore as on 30 June 2005.

The bank monitors the performance of the Golden Jubilee Rural Housing Finance Scheme being
implemented through Scheduled Banks, HFCs and Co-operative Sector Institutions. Against a target of
2.5 lakh dwelling units for the year 2004-05, 2.58 lakh units had been financed. For the Year 2005-06,
target of financing 2.75 lakh units has been set by Government of India.

NABARD

The National Bank for Agriculture and Rural Development (NABARD) came into existence on 12 July
1982. It was established for providing credit for promotion of agriculture, small-scale industries, cottage
and village industries, handicrafts and other allied economic activities in rural areas with a view to
promoting integrated rural development and securing prosperity of rural areas.

APEX COOPERARTIVE HOUSING FEDERATIONS(ACHFS)

Was started in the early 20th century to fulfil the desore of a common man of owning decent home.
At present there are 92,000 housing cooperatives at the grass root level with a membership of about 65
lakhs all over the country represented by 26 apex cooperative housing federations (ACHFS) at the state
/union territory level.

OTHERS

 STATE COOPERATIVE AGRICULTURE AND RURAL DEVELOPMENT

BANKS(SCARDBS)
Keeping in view the housing shortage in rural areas , a few state governments after suitable
legislative amendments , have permitted the ARDBS to lend for housing.

 STATE COOPEARATIVE BANKS

NHB has been extending refinance assistance to the state cooperative banks (scbs) in respect of the
housing loans given by them either directly or through the district central cooperative banks/primary
agricultural credit societies .

 PRIMARY(URBAN COOPERATIVE BANKS)

Also eligible to avail loan from the NHB provide they meet the recovery norms prescribed by NHB.
 REGIONAL RURAL BANKS

Regional Rural Banks were set up to take banking services to the doorsteps of rural masses especially
in remote rural areas with no access to banking services. These banks were originally intended to
provide institutional credit to the weaker sections of the society called ‘target groups’. The Regional
Rural Banks (RRBs) are conceived as institutions that combine the local feel and familiarity with rural
problems, which the co-operatives possess, and the degree of business organisation as well as the
ability to mobilise deposits, which the commercial banks possess. The banks werealso intended to
mobilise and channelise rural savings for supporting productive activities in the rural areas. However,
with effect from April 1997, the concept of priority sector lending was made applicable to RRBs. The
interest rates on term deposits offered and interest rates on loans charged by RRBs have also been
freed.