REPORT ON TREND AND PROGRESS OF HOUSING IN INDIA - JUNE, 2001

Institutional Framework for Housing Finance : Co-operative Sector

Apex Cooperative Housing Federations (ACHFs)

The cooperative housing movement has made significant progress over the years and the housing co-operatives have come to be acknowledged as being an effective organizational form entrusted with the responsibility of supply, maintenance and management of housing stock in the country. At present there are 90,000 housing cooperatives at the base level with a membership of about 65 lakh all over the country represented by 26 Apex Co-operative Housing Federations (ACHFs) at the state / union territory level. The National Co-operative Housing Federation of India (NCHF) has been promoting, guiding and coordinating the activities of housing cooperatives at the national level since its inception in 1969. In all 25 ACHFs are currently members of NCHF.

The cooperative housing movement is well rooted in India and during the nine decades of its existence it has made conscious effort to champion the cause of suitable housing accommodation at reasonable and affordable cost on easy terms of payment to the common populace. The ACHFs channelise long term housing loans from financial institutions to their primary cooperatives and individual members for construction / acquisition of dwelling units. However, the performance of housing cooperatives is highly influenced by the availability of low cost fund and other major constraints such as availability of land and other legal bottlenecks.

So far, an amount of around Rs. 6800 crore has been disbursed by these ACHFs to enable construction of more than 21 lakh dwelling units in the country. Presently, the ACHFs are advancing an amount of approximately Rs. 868 crore a year.

The composition of resource mobilization by the ACHFs during the last 5 years is detailed below:

Table 5.1: Borrowings of Apex Co-operative Housing Federations (cumulative) (Rs. In crore)
Year LIC NHB HUDCO State Govt. Deposits Banks Debentures Others Total
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
1999-00 2835.71 440.12 1176.71 48.97 185.77 748.60 142.60 112.28 5690.76
2000-01 2985.65 483.06 1449.42 50.13 156.63 982.00 145.26 179.57 6431.72
Source: National Cooperative Housing Federation of India; NHB data as at the end of June

The above table indicates that in the year 2000-01, the major source of ACHFs’ resource was HUDCO with financial assistance of Rs.272.71 crore followed by the banks with Rs.233.40 crore. After a gap of almost three years the ACHFs also mobilized Rs.2.66 crore through issue of debentures as well.

The quantum of cumulative sanction of housing loan by the ACHFS increased to Rs.7171.11 crore during 2000-01 with cumulative disbursal touching the Rs. 6819.11 crore mark. During the year an amount of Rs.867.72 has been disbursed registering a growth of around 24% over the previous year.

Table 5.2: Lending Operations of Apex Cooperative Housing Federations
(Rs. in crore)
Year Loan Sanctioned Loan Disbursed
1997-98 525.29 519.57
1998-99 680.88 665.88
1999-00 705.33 700.86
2000-01 842.81 867.72
Source: National Cooperative Housing Federation of India

Cumulatively, the financial assistance provided by ACHFs till the end of March,2001 enabled construction of 2138850 dwelling units.
Housing Units Financed by ACHFS
Year Houses Completed Houses Under construction Total
1997-98 70215 2477 72692
1998-99 145153 2691 147844
1999-00 55669 5639 61308
2000-01 39629 15739 55368
Source: National Co-operative Housing Federation of India

State/UT-wise break-up of housing loan disbursed and number of units
constructed with financial assistance from ACHFs during last three years
are as under :

HOUSING LOANS DISBURSED AND HOUSING UNITS CONSTRUCTED BY APEX-CO-OOPERATIVE HOUSING FEDERATIONS*
(Rs. in crore)
1998-99 1999-00 2000-01
S.No Apex-Federations Units constructed/financed LoansDisbursed Units constructed/financed Loans Disbursed Units constructed/financed Loans Disbursed
1 Andhra Pradesh 717 NA NA 9.63 300 21.68
2 Assam 1316 2.71 2340 1.53 0 0
3 Bihar 1985 13.50 0 0 2325 25.65
4 Chandigarh 9 0.36 67 0.62 0 0
5 Delhi 546 28.94 306 21.29 317 50.47
6 Goa 223 5.79 198 3.01 107 2.44
7 Gujarat 0 0 0 0 0 0
8 Haryana 160 1.65 419 5.37 143 3.32
9 Himachal Pradesh 133 0.24 52 0.49 42 1.09
10 Jammu & Kashmir 22 3.96 24 6.59 14 3.21
11 Karnataka 549 9.19 0 0 383 6.17
12 Kerala 7348 58.80 10463 75.41 9351 92.23
13 Madhya Pradesh 2100 NA 224 23.94 0 0
14 Maharashtra 693 5.09 305 2.95 331 1.98
15 Manipur 69 0.48 148 0.94 0 0
16 Meghalaya 0 0 3 0.02 0 0
17 Orissa 431 NA 680 7.90 812 2.44
18 Pondicherry 167 3.56 177 3.67 74 3.51
19 Punjab 4025 52.65 3567 52.60 3729 58.21
20 Rajasthan 411 2.24 92 0.90 44 1.27
21 Tamil Nadu 120311 456.61 42126 481.95 36611 574.21
22 Uttar Pradesh 6500 17.53 0 0 687 17.60
23 West Bengal 129 2.57 117 2.05 98 2.24
TOTAL 147844 665.87 61308 700.86 55368 867.72
* Excluding Mizoram and Andaman & Nicobar

The above table shows the steady increase in per unit loan size over the years by the ACHFs. Besides, there has been growing concentration of disbursal in the state of Tamil Nadu where the disbursal growth rate in 2000-01 was more than 19% as compared to the growth rate of around 6% in 1999-2000. Tamil Nadu alone accounted for 69% of total disbursal by ACHFs in 1999-2000 and around 66% in 2000-01.

Till the end of 2000-01 (July-June) 5 ACHFs [viz., Kerala ACHFs, Maharashtra ACHFs, Punjab ACHFs, Pondicherry ACHFs and Tamilnadu ACHFs] availed of NHB refinance. Of these, 3 ACHFs availed of refinance assistance of Rs. 42.94 crore from NHB during the year 2000-01 as against Rs.109.60 crore in the previous year.

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
1997 73.22 215.10
1998 65.07 280.17
1999 50.35 330.52
2000 109.60 440.12
2001 42.94 483.06

State Co-operative Agriculture and Rural Development Banks (SCARDBs)

Keeping in view the housing shortage in rural areas, a few State Governments, after suitable legislative amendments, have permitted the Agriculture and Rural Development Banks (ARDBs) to lend for housing. As the ARDBs do not fall under the category of either scheduled bank or specialised housing finance institutions, NHB, in order to extend financial assistance to this category of institutions, formulated a scheme to subscribe to special rural housing debentures floated by ARDBs backed by the mortgages originated by them.

During the year 2000-01, NHB disbursed Rs. 97.62 crore to ARDBs as compared to Rs. 78.22 crore in 1999-2000. Thus, during the year ended June 30, 2001, NHB extended a total refinance assistance of Rs. 140.56 crore to co-operative sector institutions as against Rs. 187.82 crore in 1999-2000. Thus as at the end of June 30, 2001 NHB’s cumulative refinance assistance to co-operative sector institutions stood at Rs.1066.74 out of the cumulative refinance assistance of Rs.6221.48 crore.

State Co-operative Banks

In order to strengthen the cooperative credit structure of the country which has been performing a commendable task in providing credit to the housing sector, NHB has been extending refinance assistance to the State Cooperative Banks (SCBs) in respect of the housing loans given by them either directly or through the District Central Cooperative Banks/primary agricultural credit societies. So far, a few SCBs have been found eligible for availing the refinance facility from NHB. The cumulative refinance assistance extended by NHB to the SCBs as at the end of June, 2001 stood at Rs.49.89 crore.

Primary (Urban) Co-operative Banks

The scheduled Primary Urban Cooperative Banks are also eligible to avail refinance assistance from NHB provided they meet the recovery norms prescribed by NHB. Like the case of SCBs, not many primary (urban) cooperative banks have been in a position to avail refinance assistance from NHB. During the year ended June 30, 2001, Rs. 10.00 crore was disbursed by NHB to this category of institutions. The cumulative refinance assistance extended by NHB to these institutions stood at Rs.30.15 crore by the end of June,2001 and the outstanding was Rs.24.66 crore.

Recovery Performance of ACHFS and ARDBs

As per the information available from these institutions, their recovery position has declines, in most of the cases, during the year 2000-01 as compared to the previous year which is not a good sign for this sector.

Recovery Performance of Cooperative Sector Institutions

Institution 1999-2000 2000-2001
Punjab ACHFS 84.99 84.56
Tamil Nadu ACHFS 66.16 65.95
Kerala ACHFS 92.63 90.30
Pondicherry ACHFS 66.00 59.00
Kerala ARDB (state level rec.) 95.51 92.35
Figures in percentage