business
Housing Finance Companies and the new rules
Feb 22, 06:02

We are all familiar with the term Housing Finance Companies (HFC). These companies are aggressive players in the home loan market. But what are HFCs and how are these firms different from banks? The RBI defines an HFC as an NBFC whose financial assets in the business of housing finance are at least 60 percent of its total assets. Of the total assets, not less than 50 percent should be for housing finance for individuals. HFCs, which currently do not fulfil this criterion, need to meet the 60 percent cut-off by March 2024. Else, these firms will be treated as NBFC – Investment and Credit Companies. Banks do not have any such rules.

HFCs gfx - Feb 22