The Reserve Bank of India(RBI) has approved a proposal to shift regulation of Housing finance companies(HFCs) from the National Housing Bank(NHB) to the RBI.
Hence,HFCs will now be treated as one of the categories of non-banking financial companies(NBFCs) for regulatory purposes.
Further,any housing finance institution which is a company desirous of making an application for registration under the NHB Act,1987 must approach the department of Non-Banking Regulation at the RBI.
RBI will also review the current regulatory framework applicable to housing finance companies(HFCs) following which it will come out with revised regulations.
Until the new guidelines,HFCs shall continue to comply with the directions and instructions issued by the NHB which will continue to carry out supervision of HFCs.
The National Housing Bank(NHB) was set up in 1988 under the National Housing Bank Act,1987.NHB is an apex financial institution for housing.
Its objective is to operate as a principal agency to promote housing finance institutions both at local and regional levels and to provide financial and other support incidental to such institutions and for matters connected therewith.
Recently,RBI had divested its stake in National Housing Bank(NHB) and National Bank for Agriculture & Rural Development (Nabard) by making them fully government-owned.