MUMBAI: In a significant move towards transparency, the National Housing Bank (NHB) has released, for the first time, the list of beneficiaries under its refinance scheme. This initiative aims to prevent the misuse of NHB’s name by various lending institutions.
This decision follows the exposure of Aviom India Housing Finance, which reportedly used outdated NHB refinance sanction letters, some dating back three to four years, to obtain loans from banks.
“The NHB is committed to ensuring such incidents as those involving Aviom do not occur again. By making its refinance list public, it seeks to deter fraudulent entities from leveraging its name to secure loans from other financial institutions,” stated the CEO of a housing finance company.
The NHB has disclosed nearly 50 housing finance companies (HFCs) that availed refinancing assistance in FY25, which includes well-known names like LIC Housing Finance, PNB Housing Finance, Can Fin Homes, and Aadhar Housing Finance, among others.
By providing access to this data, the regulator aims to empower lenders and market players to independently verify refinance claims and thwart potential exploitation of NHB’s credentials in securing funds.
Currently, Aviom India Housing Finance is under scrutiny by NHB for allegedly misusing refinance funds, diverting them to fraudulent mutual fund investments. This has raised concerns about the broader risks posed by opaque refinancing disclosures in the sector.
NHB plays a vital role in the mortgage ecosystem by providing refinancing facilities to HFCs for the housing loans they extend, especially within the affordable housing sector. This refinancing enables housing finance companies to secure low-cost, long-term funds, which can then be offered to homebuyers as more affordable interest rates.
According to industry sources, under its new leadership, NHB has revamped the refinance disbursal process to ensure fairer allocation of funds throughout the sector.
“Previously, a significant portion of refinance was monopolized by a few large HFCs. The new NHB leadership has devised an internal formula that guarantees all notable HFCs receive access to cost-effective funding based on their size and growth,” remarked the CEO of another housing finance company.
NHB’s refinance assistance continues to be a crucial source of long-term liquidity for the housing finance industry.
