Apex Co-operative Housing Federations (ACHFS)

REPORT ON TREND AND PROGRESS OF HOUSING IN INDIA - JUNE, 1999

Institutional Framework for Housing Finance : Co-operative Sector

Apex Co-operative Housing Federations (ACHFS)
5.1 Besides the HFCs, the other category of institutions which act as dedicated outlet for providing housing finance are the Apex Cooperative Housing Federations (ACHFS). These ACHFS provide housing loans mainly through the Primary Cooperative societies which are affiliated to them. A few of the ACHFS have also started providing housing loans directly to individuals. All the ACHFS are member of the National Cooperative Housing Federation of India (NCHF) which has been promoting, guiding and coordinating the activities of housing cooperatives at the national level since its inception in 1969. The NCHF is entrusted with the task of improving the operational efficiency of its member federations as well as ensuring the augmented flow of funds to the cooperative housing sector.

5.2 LIC was the largest provider of funds to the ACHFs till the year 1996-97, even though there was a constant reduction in the financial assistance provided by them in absolute terms. From 1997-98, HUDCO has become the largest source of resources to ACHFS.It is observed from the table below that the contribution of HUDCO to ACHFS has been steadily increasing over the years from 1993-94. The total borrowings of the ACHFS as on 31-3-99 were Rs.4957.14 crore of which Rs.2702.48 crore (54.52%) came from LIC. The balance has come from deposits from the primary societies (Rs.157.90 crore), borrowings from State Government (Rs.49.07 crore), borrowings from HUDCO (Rs.922.33 crore), borrowings from Banks (Rs.565.15 crore) and borrowings from NHB (Rs.330.52 crore) while Rs.142.60 crore have been raised by floating debentures.

Table 5.1: Borrowings of Apex Co-operative Housing Federations (cumulative)
(Rs. in crore)
Year LIC NHB HUDCO State Govts Deposits Banks Debentures Others Total
1992-93 1939.72 73.07 229.70 124.50 55.23 260.77 136.40 20.25 2839.64
1993-94 2087.46 104.66 285.36 137.50 122.01 308.01 137.60 7.37 3189.97
1994-95 2215.98 116.77 359.46 148.55 129.83 276.94 142.60 37.39 3427.52
1995-96 2348.98 141.88 442.88 166.04 46.19 410.56 142.60 110.27 3809.40
1996-97 2480.48 215.10 569.03 169.34 186.74 225.13 141.50 58.31 4045.63
1997-98 2606.48 280.17 721.91 185.29 162.71 349.73 142.60 58.31 4507.20
1998-99 2702.48 330.52 922.33 49.07 157.90 565.15 142.60 87.09 4957.14
Source : The National Cooperative Housing Federation of India
5.3 The operations of ACHFS in terms of the loans sanctioned and disbursed has been increasing over the years. The loans sanctioned by them increased from Rs.177.60 crore during 1996-97 to Rs.525.29 crore during 1997-98 and further to Rs.680.88 crore during 1998-99. In terms of disbursements the increase was from Rs.314.72 crore during 1996-97 to Rs.665.88 crores during 1998-99. The financial assistance provided by ACHFS during the year 1998-99 enabled construction of 1,47,844 dwelling units.

Table 5.2: Operations of Apex Co-operative Housing Federations
(Rs. in crore)
Year Borrowings Repayments Outstanding Loan Sanctioned Loan Disbursed
1996-97 337.00 112.25 224.75 177.60 314.72
1997-98 473.70 127.79 345.92 525.29 519.57
1998-99 448.82 236.13 212.69 680.88 665.88
(Source: National Co-operative Housing Federation of India)

5.4 The cumulative housing loans sanctioned by ACHFS as on March 31,1999 amounted to Rs.5622.96 crores and the disbursements Rs.5250.52 crores. The financial assistance provided by ACHFS till the end of March,1999 has resulted in addition of 20,22,174 dwelling units to the housing stock.

Table 5.3: Housing Units Financed by ACHFS
Year Houses Completed Houses Under construction Total
1996-97 17322 30103 47425
1997-98 70215 2477 72692
1998-99 145153 2691 147844
Source: National Co-operative Housing Federation of India

5.5 State/UT-wise break-up of housing loan disbursed and number of units constructed with
financial assistance from ACHFS during 1997-98 and 1998-99 was as under :

Table 5.4: HOUSING LOANS DISBURSED AND HOUSING UNITS CONSTRUCTED BY APEX-CO-OOPERATIVE HOUSING FEDERATIONS*
(Rs. in crore)
1998-99 1997-98
S.No. Apex-Federations Units constructed/financed Loans Disbursed Units constructed/financed Loans Disbursed
1 Andhra Pradesh 717 NA 2265 12.54
2 Assam 1316 2.71 308 3.12
3 Bihar 1985 13.50 0 0
4 Chandigarh 9 0.36 42 0.03
5 Delhi 546 28.94 1570 41.24
6 Goa 223 5.79 483 6.63
7 Gujarat 0 0 0 0
8 Haryana 160 1.65 225 7.81
9 Himachal Pradesh 133 0.24 66 0.05
10 J&K 22 3.96 32 3.71
11 Karnataka 549 9.19 482 7.65
12 Kerala 7348 58.80 16583 60.17
13 Madhya Pradesh 2100 NA 960 10.26
14 Maharashtra 693 5.09 812 8.83
15 Manipur 69 0.48 422 1.14
16 Meghalaya 0 0 0 0
17 Orissa 431 NA 311 1.84
18 Pondicherry 167 3.56 803 1.65
19 Punjab 4025 52.65 1724 49.04
20 Rajasthan 411 2.24 48 1.01
21 Tamil Nadu 120311 456.61 43907 283.91
22 UP 6500 17.53 1363 13.11
23 WB 129 2.57 286 5.83
TOTAL 147844 665.87 72692 519.57
* Excluding Mizoram and Andaman & Nicobar

The number of housing units constructed/financed by ACHFS increased by more than 100% during the last two years with the Tamil Nadu ACHFS registering a commendable performance of financing 1,20,311 housing units in 1998-99. The financial assistance provided by ACHFS also increased by 28.16% from a level of Rs.519.57 crore in 1997-98 to Rs.665.87 crore in 1998-99.

5.6 In terms of refinance guidelines of NHB only 4 ACHFS were eligible for refinance assistance as at the end of June,1999. To be eligible for refinance assistance, an ACHFS should have a recovery level of 75% of the demand fallen due during the preceding 12 months [for Category-I ACHFS eligible for 100% refinance assistance] and 60% [ for Category-II ACHFS eligible for 50% refinance assistance] with an increase of 5% each in the previous two years .

5.6 During 1998-99 NHB disbursed Rs 50.35 crore to various ACHFS. With this, the cumulative refinance from NHB to ACHFS has gone up to Rs.330.52 crore of which Rs.263.14 crore were outstanding as on 30th June 1999. Data pertaining to NHB's refinance assistance to ACHFS during last 5 years is given below:

NHB's Refinance Assistance to ACHFS
(Rs. in crore)
Year ended 30th June Yearly Refinance Cumulative Refinance
1995 12.11 116.77
1996 25.11 141.88
1997 73.22 215.10
1998 65.07 280.17
1999 50.35 330.52

State Co-operative Agriculture and Rural Development Banks (SCARDBs)
5.8 The State Co-operative Agriculture and Rural Development Banks (SCARDBs) constitute the long term Cooperative credit structure. Initially, lending for housing was not in the ambit of their activities. In order to make available more institutional funding in the rural areas for housing purposes, the central government recommended to the state governments to amend the enactments/bye-laws of SCARDBs so as to enable them to lend for housing. Accordingly, a few states have paved the way for these ARDBs to lend for housing.

5.9 Since ARDBs are neither scheduled banks nor can be classified as specialised housing finance institutions, NHB could not provide them refinance assistance. However, in order to extend financial support to them, NHB formulated a scheme to subscribe to special rural housing debentures to be floated by SCARDBs backed by the mortgages originated by them.

5.10 During the year 1998-99, NHB disbursed Rs. 163.09 crore to the institutions in the co-operative sector , constituting 21.83 % of the refinance disbursals for the year. This included Rs.50.35 crore for financing 3093 units disbursed to the ACHFS and Rs. 112.75 crore to the ARDBs in respect of their lending for 14133 units of rural housing, by subscribing to Special Rural Housing Debentures (SRHDs) issued by them. The share of the co-operative sector institutions in NHB's cumulative refinance till 30th June, 1999 comes to 16.88 %, i.e. Rs.738.37 crore out of total cumulative refinance support of Rs. 4374.01 crore.