Bihar government in association with Central Bank of India , will now provide housing loans up to Rs 30 lakh at base rates — the lowest rate of interest on loan offered by any bank in the country that is regulated by the Reserve Bank of India.
Both parties today signed the memorandum of understanding during the launch of the scheme in the state capital in the presence of chief minister Nitish Kumar and his deputy Sushil Kumar Modi.
“I would like to congratulate Central Bank of India for starting this scheme wherein all employees of the state government are given the opportunity to avail housing loans up to Rs 30 lakh. However, the existing scheme of the state government to give housing loans up to Rs. 7.5 lakh would run concurrently. Under the new scheme, the equated monthly instalments (EMI) would be deducted from the salary of the employees. Central Bank has also been the partner of the state government in the payment of wages through the E- Shakti card scheme under Mahatma Gandhi National Rural Employment Guarantee Act,†said Nitish.
Nitish, however, criticised the banks on their role in partnering the state in development schemes.
“Since our first term, the state government has tried their best to execute various development schemes where contributions from banks were not as expected. Earlier, we had started giving free school uniforms to students from standard six and above and bicycles to high school girls. The uniforms cost Rs 750 and the bicycles cost Rs 2,000, all of which were borne by the state government. Also, we had given agriculture input subsidy during the floods in 2007. The contribution of banks in many similar schemes was not satisfactory. Moreover, even today there are many blocks in the state which do not have banks. But I am happy with the assurance of Central Bank of India that they would open branches in many such blocks. I hope more banks would come up and maintain this spirit,†the chief minister said.
Deputy chief minister Sushil Modi urged the bank to start similar low interest housing loan schemes for legislators of the state and vehicle loan schemes for government employees in the future.
Modi also raised concerns on the distribution of differential rate of interest (DRI) loans to economically backward people.
“The DRI loans are offered at four per cent interest rate. While in other states banks distribute one per cent of the total loan amount as DRI to economically backward people in a financial year, in Bihar the banks have distributed only 0.17 per cent of the total loan amount in the previous year. The banks need to pay heed in this regard,†Modi said.
Rameshwar Singh, principal secretary, finance, lauded the new housing loan scheme for government employees. “The scheme would not only provide easy finance options for government employees but also boost the housing sector in the state. Moreover, I would request Central Bank to start a helpline for these loans in the district headquarters,†the officer said.
Mihir Kumar Singh, the secretary of the state finance department, informed that three more banks are also in the pipeline for providing lower interest rate housing loans and they have also received the approval from the cabinet. He also informed that Central Bank would not levy any penalty for early payment of EMI.
Ten state government employees were issued these loans today during the launch of the scheme. State government employees are upbeat. “This is a good move as now we would be getting much bigger loans at lower rate of interest. Moreover, the terms of availing this loan are simpler and the EMI would be directly deducted from the salaries. Thus there would be no hassle in repayment,†said Om Prakash Yadav, an employee in the state secretariat.