Rural Housing Scheme

With a view to supplementing the efforts of Government of India, State Governments, National Housing Bank and Banking Sector in augmenting the resources for the Rural Housing segment, NABARD has included Rural Housing as an eligible activity for extension of refinance (investment credit) to the eligible banks w.e.f. 01 April 2001. The broad terms and conditions for the refinance scheme are as under :

Area of Operation

Refinance will be provided to all eligible banks for finance extended by them to housing projects in the 'rural' areas only. As per NABARD Act, Rural area means the area comprised in any village and includes the area comprised in any town, the population of which does not exceed 50000 or such other figure as the RBI may specify from time to time.

Eligible Borrowers

Financing made under Golden Jubilee Rural Housing Scheme and Schemes of the Govt. of India, Ministry of Rural Development shall also be eligible for NABARD refinance.

Eligible Purposes

Construction of New Houses as well as Repairs/Renovation of existing houses in rural areas/ Rainwater Harvesting Structures/ Sanitary Latrines, etc.

Security/ Margin

As per RBI / NHB guidelines issued from time to time.

Ceiling on the cost

The cost of the dwelling unit may not exceed Rs.20 lakh. In case land is being acquired, the land cost may be reckoned as Margin Money. Otherwise the cost of land should not be included in the project cost.

 Rate of interest on NABARD Refinance:

As decided by NABARD from time to time.

Repayment period
For new houses - not more than 15 years
For Repairs/ Renovation - not more than 7 years

Moratorium