Ailing Low-cost housing in India: World Bank comes as a rescue
In what has been earmarked as one of the biggest newsmakers of 2013, the World Bank has agreed to offer USD 100 million soft loan to the nation in a move to strengthen the low-income households in urban regions. The offered loan amount from the International Financial Institution, will enable the low-income households to upgrade, build or purchase new houses, step out of the poverty level and strike towards prosperity.
NHB, the National Housing Bank, will put into action the Low Income housing Finance Project that will give a hand to the government’s agenda for financial inclusion, on two basic fronts- It will tone up the financial institutions which target the low income households and provide the means for such groups in urban regions to access the housing finance.
Project objective
According to government officials, the sole aim of the project is offer access to housing finance for lower income groups. The project will include three basic components of financial aid for low cost and sustainable housing for NHB-refinance low-income housing loans by QPLIs to Primary Borrowers to buy, upgrade or build their home.
The project also intends to deliver its best on its stated objective of offering financial aid to a higher portion of lower-income groups, at the same time adhering portfolio quality standards. Financing the project intends to generate incentives for the lenders to concentrate on lower income households via a net all-in decline of the lenders’ cost of funds precisely 200-300 basis points.
Role of World Bank
The help from the World Bank has stepped in at a time when the Indian real estate is experiencing huge demand for affordable housing. According to experts, the aiding project from the World Bank will stimulate further growth in this sub-segment of Indian real estate and reinforce the needy sections of the society. With such a move, the World Bank is likely to boost the residential real estate sector of India and induce balance of growth for all segment of buyers.
As an attempt to hold up and encourage the affordable housing segment in India, a joint effort from all the stakeholders is a must in the days to come. Rightful allocation of funds, considerate planning and a careful targeting on the qualified beneficiaries can speed up the sustainable progress of lower-income segment of home buyers. The aid offered by World Bank is the first step towards towards prosperity for the lower income homebuyers.
