Banks should finance projects registered in RERA only

RERA Chairman Shri Antony DeSa at State Level Meeting of Bank Officers

Bhopal : Thursday, November 22, 2018

The Chairman of RERA Shri Antony DeSa has said that banks should finance projects registered in RERA only. He further mentioned that real estate projects and colonies are required to follow the rules of the RERA Act. Along with this, there is a proper professional option for finance which ensures better chances of loan recovery. A guide in this connection has also been issued by the Reserve Bank of India. Shri DeSa further stated that banks should finance these projects only on priority. He was addressing the State level meeting of Bank Officers in Bhopal today.

Moreover, Shri Desa said that registration in RERA ensures guarantee to allottees for allotment of residences on time. He mentioned that loan to unregistered project is neither in the interest of people nor in the rules and is not a right professional decision. He said that unregistered projects are against the RERA Act and illegal too. Banks should avoid investment in loan cases of such projects.

Shri DeSa has informed during the meeting that banks should sanction loan installment according to the site inspection in ratio of stage wise completion of project. It is necessary for builders to keep 70 percent of the amount received from the allottees in the escrow account of the project. Along with this, banks should allow them to withdraw amount only according to the completion certificate.

The Lead Officer of the State Level Banking Shri Ajay Vyas has assured on behalf of the banks at the meeting that financing is being done in projects and colonies in the state according to the rules of the Reserve Bank of India and RERA Act.

State Heads of all the private and government banks functional in the state and representatives of the Reserve Bank of India were present at the meeting.