The real estate industry needs innovative loans, said RBI deputy governor R Gandhi

Housing loan providers should introduce innovative products, such as savings linked loans, and in the case of low notes receivable credit risk through insurance cover should be, the Reserve Bank of India Deputy Governor R · Gandhi said on Friday.

Stressed the need for the case of financial innovation products Gandhi said housing loan or mortgage home loan savings deposits such products may cause.

Speaking of banks and investment Reform Conference: Housing for all in 2022 by the National Real Estate Development Council (NAREDCO) sponsored, Gandhi said:. "Willing consumers may be induced to produce balanced way of monthly or regular savings deposits"

"This will create a track record of repayment of future housing loan products, once the customer reaches the threshold of balance, financial institutions may consider sanction of housing loans in the account balance can serve as collateral or margin."

According to him, the accumulation amount each month will serve as a base to assess the customer's ability to repay the purpose of calculating the monthly repayment installments.

Gandhi said that the credit risk originating in the housing sector, especially low-cost housing parts ticket should also be through the banks and other lenders of appropriate insurance plan.

He said the housing finance system needs to support a clear legal systems and instruments.

Gandhi said, involves easy access to land, accessible financing, supportive legal framework and innovative technologies comprehensive approach required to achieve the full potential of continued real estate and housing sector fulcrum.

RBI and the central government's measures taken out, Gandhi said, financial institutions (banks and housing finance companies) housing loan portfolio increased from $ Rs.4.60 trillion in 2010 of Rs.8.90 trillion dollars in 2014.

According to Gandhi, despite the importance of the real estate and housing sectors of the economy, global regulatory agencies believe that fluctuations in these industries, it is easy to form an asset bubble requires special regulatory measures.

"Many of the financial crisis, the world's excesses in these areas has caused .2008-09 recent global economic and financial crisis has caused these excesses, so the regulatory approach has been highly sensitive to these sectors," he said.

Gandhi said that the provisions of the Reserve Bank of India has also been included for the excessive and rapid flow of credit, the provisions of prudential norms of banks and non-bank financial companies in real estate lending activities.
SOURCE : WEB