National Housing Bank (NHB) has rolled out a ₹10,000-crore ‘Special Refinance Facility-2021’ (SRF-2021) to provide short term refinance support to housing finance companies (HFCs) and other eligible Primary Lending Institutions (PLIs).

This facility is expected to meet the short-term liquidity requirements of the PLIs and will also support them for onward lending to individuals to maintain steady growth in the housing finance sector, according to NHB.

This NHB initiative comes on the heels of the Reserve Bank of India (RBI) extending fresh support ( in the recent monetary policy review) under another Special Liquidity Facility-2 (SLF-2) of ₹ 10,000 crore to the NHB for one year to support the housing sector.

RBI to provide ₹50,000-cr refinance to all-India financial institutions

Post Covid -19, the housing finance sector has revived and showed steady improvement in sanctions and disbursements since the second quarter of FY2020- 21.

It may be recalled that last year during May-August 2020, NHB had provided refinance support of ₹ 14,000 crore under the Special Refinance Facility (SRF) and Additional Special Refinance Facility (ASRF).

This short-term liquidity support for a year was part of Special Liquidity Facility (SLF) granted by the RBI at repo rate to NHB under Aatma Nirbhar Bharat Abhiyaan announced by the Finance Minister.

Return of DFIs

During the period April 1, 2020 to March 31, 2021, NHB had extended an amount of ₹ 42,823.93 crore as refinance to PLIs which includes HFCs, Scheduled Commercial Banks including Regional Rural Banks (RRBs), Small Finance Banks (SFBs), under its various refinance Schemes including SRF and ASRF extended by the RBI.

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