- The HFC’s deposit with NHB would be an eligible investment under Section 29B of the National Housing Bank Act, 1987.
- The Special Term Deposit Scheme for HFCs has been rated FAAA by CRISIL and AAA by Fitch indicating highest safety.
- The Scheme will be applicable only to the HFCs accepting deposits from public.
- Minimum deposit of Rs. 25,00,000 (Rs. twenty five lacs) and in the multiple of Rs. 5,00,000 (Rs. five lacs) thereafter, upto Rs. 5,00,00,000/- (Rs. five crores) for duration of 18 months to 60 months. For any deposit amount above Rs. 5,00,00,000/- (Rs. five crores), prior approval from NHB is mandatory.
- Deposit period would range from 18 months to 60 months.
- The rate of interest is subject to change from time to time & the latest rates can be checked from NHB’s website.
- Interest is payable Quarterly / Yearly or on Cumulative Basis.
- Interest would be compounded quarterly.
- Direct credit of interest to HFC’s bank account.
The National Housing Bank (NHB) was established on 9th July 1988 under an Act of the Parliament viz. the National Housing Bank Act, 1987 as a wholly owned subsidiary of Reserve Bank of India to function as a principal agency to promote Housing Finance Institutions and to provide financial and other support to such institutions. The Act, inter alia, empowers NHB to:
- Issue directions to housing finance institutions to ensure their growth on sound lines.
- Make loans and advances and render any other form of financial assistance to scheduled banks and housing finance institutions or to any authority established by or under any Central, State or Provincial Act and engaged in slum improvement and
- Formulate schemes for the purpose of mobilization of resources and extension of credit for housing
Summarized Financial Position
|Reserves & Surplus||1558.00||1389.00||1288.00|
|Borrowings & Deposits||16981.00||18479.00||16859.00|
|Loans & Advances||17671.00||19572.00||16363.00|
|Cash & Bank Balances||1090.00||972.00||2158.00|
|Profit & Loss Account||30.06.08||30.06.07||30.06.06|
|Profit before Tax||256.00||184.00||138.00|
|Profit after Tax||170.00||114.00||86.00|
Terms of the Scheme
Mode of Acceptance
The application forms complete in all respect together with Cheque/DD should be submitted at NHB’s Head Office in New Delhi/Mumbai Office or Representative Offices in Hyderabad, Banglore, Chennai and Kolkata. The date of deposit would be taken as the date of realization of cheque/DD. Cheque/demand draft should be drawn in favour of “National Housing Bank” payable at New Delhi/Mumbai.
Interest rate applicable on the deposit would be the rate prevailing as on the date of acceptance of such deposit. Interest will be calculated on the basis of 365 days a year. Interest on cumulative deposits will be compounded quarterly and paid together with the principal amount on maturity whereas interest on other schemes will be paid on a quarterly or annual basis, as the case may be.
Tax Deduction at Source
NHB will deduct Income Tax at source from interest on deposits in accordance with the applicable provisions of the Income Tax Act, 1961 in force from time to time. No tax, however, shall be deducted by NHB if the HFC furnishes to NHB relevant certificate/declaration/order as may be prescribed under the Income-Tax Act, evidencing grant or exemption from income-tax deductions at source of permitting deduction of tax at a rate lower than otherwise applicable. NHB shall not be liable to refund to the HFC(s) the amount of tax that may have been already deducted if such certificate/declaration/order shall not have been submitted by the HFC(s) at least three weeks prior to the date of payment of interest or maturity value of the deposit as the case may be.
Repayment/Renewal of Deposit
- The Deposit will automatically expire on maturity. No interest will thereafter accrue on such deposit unless the deposit is renewed.
- For repayment, the Deposit Receipt duly discharged on a revenue stamp of requisite value by the HFC entitled to receive payment should be submitted to NHB atleast one week prior to the date of maturity. If so desired, repayment will be directly credited to HFC’s Bank Account.
- When the date of maturity falls on any day on which the office of NHB remains closed, the payment will be made on the next working day.
- For renewal, a fresh application form duly filled by HFC(s) should be submitted to NHB at least one week prior to the date of maturity. Deposits may be renewed on such terms & conditions as applicable on Special Term Deposit Scheme for HFCs at the date of such renewal.
- Requests for premature withdrawal will be considered in accordance with guidelines issued by RBI from time to time. The present guidelines are as follows :-
(a) Premature withdrawal before six months – no interest to be paid
(b) Premature withdrawal between six months and one year – interest rate not exceeding savings bank rate as specified by RBI for scheduled commercial banks be paid.After 1 Year, One percent less than the rate prevailing as on the Date of Deposit applicable for the period the deposit has run. In case the deposit has run for less than 18 months but more than 1 year, 18 months rate would be taken in consideration.
Change of Address
Change of address, if any, of the HFC shall be lodged in writing with the Head Office of NHB at least two weeks before the date on which a payment fails due for being acted upon.
Loan against Deposit
NHB will not provide any loan against a deposit issued under this scheme.
- Deposit Receipt will be sent by Registered Post/Courier within a period of 15 days after date of deposit.
- The Deposit Receipt is not transferable
In the event of loss, theft, destruction, mutilation or defacement of the Deposit Receipt, NHB may at its sole discretion and at the cost of the depositor issue a duplicate Deposit Receipt subject to compliance with such terms and conditions, including an indemnity from the HFC, as may be deemed fit by NHB.
The application forms must be complete in all respect and submitted at NHB’s Head Office in New Delhi or Regional Office in Mumbai or Representative Offices in Hyderabad, Banglore, Chennai and Kolkata along with following documents:
- Resolution of the Board of Directors to open an account and identification of those who have authority to operate the account.
- Identification of authorised signatories based on signature cards duly attested by the company.
- copy of PAN allotment letter
- Cheque/demand draft favouring “National Housing Bank” payable at Mumbai/New Delhi.
Incomplete Application is liable to be rejected and NHB would not be responsible for consequences thereof.
NHB reserves the right to waive or amend or alter all or any of the above terms and conditions and also to reject any application for a fresh deposit or for renewal without assigning any reason in which event the amount of deposit received by NHB will accordingly be refunded without interest to the HFC.
Acceptance, renewal and repayment of deposits will be governed by guidelines issued by RBI from time to time and subject to Delhi/Mumbai Jurisdiction.