New Delhi:(Page3 News Network)-In order to address the issues of credit enablement of Economically Weaker Sections and Low Income Group households and to incentivize banks and financial institutions to provide loans to these segments for housing, Rajiv Awas Yojana (RAY), launched on 02.06.2011 envisaged the establishment of a Credit Risk Guarantee Fund. Accordingly, the Government has approved the establishment of a Credit Risk Guarantee Fund Trust (CRGFT) for low income housing, with an initial corpus of Rs.1000 Crore. The Credit Risk Guarantee Fund Trust has been registered on 1st May, 2012 and the Credit Risk Guarantee Fund Scheme has been launched on 31st October, 2012. The CRGF Trust will administer and operate the Scheme, which is demand-driven. This was stated by Shri Ajay Maken, Union Minister of Housing & Urban Poverty Alleviation (HUPA), in the Rajya Sabha today, in a written reply to a question by Shri D. Raja & Shri M.P. Achuthan. The Minister stated that under the Scheme, the Trust will provide guarantee to lending agencies for housing loans extended by them to persons belonging to the Economically Weaker Sections / Low Income Groups upto Rs. 5 Lakh, without any third party guarantee or collateral security.
The Minister further stated that the lending institutions eligible to avail benefit of the Guarantee cover under the Scheme are Scheduled Commercial Banks, Regional Rural Banks, Urban Co-operative Banks, Non Banking Financial Companies-Micro Finance Institutions (NBFC-MFIs), Apex Co-operative Housing Finance Societies registered under the State Co-operative Societies Act and Housing Finance Institutions registered with National Housing Bank (NHB). National Housing Bank is the identified agency for operationalising CRGF, the Minister added.
