Financial Daily from THE HINDU group of publications
Thursday, Jan 27, 2005
Industry & Economy
Money & Banking - Housing Finance
AP asks banks to cut interest rates on loans under housing scheme
Hyderabad, Jan. 26
THE Andhra Pradesh Government on Wednesday urged the bankers to further reduce the interest rate by 100 basis points for the loans on mass housing initiatives taken up under `Rajiv Gruhakalpa' programme.
At the State-Level Bankers' Committee meeting convened here on Wednesday, the Chief Minister, Dr Y.S. Rajasekhara Reddy, has impressed upon the bankers the need to further reduce the interest on the housing loans to seven per cent as against eight per cent recommended by the steering committee, a press release issued by the CM's office said.
The meeting was convened to discuss details on the construction of one-lakh houses under `Rajiv Gruhakalpa' programme in Ranga Reddy district. The Chief Minister has also asked the bankers to consider extending 100 basis points of interest concession to those beneficiaries who pay their loan instalments regularly without defaulting.
Of the proposed one-lakh houses, Dr Reddy called upon the major banks such as Andhra Bank, State Bank of India and State Bank of Hyderabad to share 20,000 units each for extending loans, while the other banks could take up the balance 40,000 housing units.
SBI Deputy Managing Director, Mr S.K. Bhattacharya, SBH Managing Director, Mr Amitabha Guha, Andhra Bank General Manager, Mr G. Ramakrishna Reddy, AP Housing Board Managing Director, Mr S.N. Mohanty, and other senior officials attended the meeting.
Explaining the Government's objective of providing own houses to urban poor, the Chief Minister said the registered beneficiary would get the land free, while the house costing Rs 1 lakh would be provided with all facilities such as roads, power, tap water, toilets and good ventilation.
According to him, 30 per cent of the total cost of the house would be borne in by the Government in the form of infrastructure development. Of the remaining 70 per cent cost, the Government would provide 10 per cent as subsidy and banks would meet the rest 60 per cent as loan at low interest.
Stating that the housing programme was meant for those urban poor having a monthly income of Rs 3,000 in 26 locations in Ranga Reddy district around the twin cities of Hyderabad and Secunderabad, Dr Reddy said so far 10,000 registrations at the rate of 2,000 per day were made and the entire registrations process would be completed by February 15.
The housing project would be completed and ready for occupation in 18 months with all the infrastructure facilities, he said.
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