JNNURM housing loans turn into NPAs

The loans sanctioned to beneficiaries of Jawaharlal Nehru National Urban Renewal Mission (JNNURM) houses have turned into Non-Performing Assets (NPAs) for the banks.

The State Bank of Hyderabad, Gayatri Nagar branch, sanctioned Rs.3.174 crore as loan to 1,058 beneficiaries more than a year ago. However, none of the beneficiaries have repaid and the total amount due has touched Rs.4.10 crore, including interest.

The bankers have been asking the Vijayawada Municipal Corporation to help them in recovering the money. It may be recalled that there was a proposal to include caveat clause in the title deed as the bankers, were initially, disinclined to sanction loans citing audit objections.

Subsequently, it was decided to include a caveat related to recovery of bank dues as per the AP R&R Act, 1864 in the title deed being issued to the beneficiaries. The bankers, referring to the audit objections, stated that the loans could be issued only if the JNNURM housing was brought under the purview of the Andhra Pradesh Revenue Recovery Act, 1864.

The due, however, could not be recovered for various reasons, including non-availability of original beneficiary, unwillingness to repay and inability to repay. Municipal Commissioner Md. Abdul Azeem has asked the bankers to delink the loans sanctioned to the 1,058 beneficiaries from future loans as another set of 16,000 houses were ready for sanction.

The VMC has no plans to jettison the bankers and wash off its hands. If the bankers could arrange the loans for remaining houses, the issue could be treated on a different footing.

The bankers were asked to spell out their view on or before November 30. The Commissioner also asked the Lead Bank Manager to convene a meeting with the bankers who were willing to sanction loans to the JNNURM housing beneficiaries.

It may be recalled that initially, it was planned to sanction loans to 5,242 beneficiaries.

As the process began, the bankers sanctioned loan to 1,058 beneficiaries. Most of them had not paid their contribution, though they occupied the houses. To encourage the beneficiaries, the VMC even organised melas on bank loans.

Our code of editorial values

This article is closed for comments.
Please Email the Editor

Printable version | Jan 19, 2022 5:40:51 AM |

Next Story