FDI in Housing Finance

[satya jyothi]

 

 

Can a foreign company invest in housing finance sector in India? If yes, then what are the limits?

 

 

Rgds,

[R V SECKAR]

Yes.  Foreign investment in NBFC is allowed under the automatic route in housing finance sector and is allowed up to 100% under automatic route.

Regards


R.V.Seckar

Pl do visit my blogs :http://rvseckarcompanylaw.blogspot.com/

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[Ramaswami Mohan]

2.

Non-Banking Financial Com-panies (NBFC)

100%

FDI/NRI investments allowed in the following 19 NBFC activities shall be as per the levels indicated below : (a) Activities covered – Merchant Banking; Under Writing; Portfolio Management Services; Investment Advisory Services; Financial Consultancy; Stock-broking; Asset Management; Venture Capital; Custodial Services; Factoring; Credit Reference Agencies; Leasing & Finance; Housing Finance; Forex-broking; Credit Card Business; Money-changing Business; Micro-credit; Rural credit. (b) Minimum Capitalisation norms for fund based (NBFCs) – (i) For FDI upto 51%, US $ 0.5 million to be brought in upfront; (ii) If the FDI is above 51% and upto 75%, US $ 5 million to be brought upfront; (iii) If the FDI is above 75% and upto 100%, US $ 50 million out of which $ 7.5 million to be brought in upfront and the balance in 24 months. (c) Minimum Capitalisation norms for non-fund based activities – Minimum Capitalisation norm of US $ 0.5 million is applicable in respect of non-fund based NBFCs with foreign in¬vestment. (d) Foreign investors can set up 100% operating subsidi¬aries without the condition to disinvest a minimum of 25% of its equity to Indian entities, subject to bringing in US $ 50 million as at (b) (iii) above (without any restriction on number of oper¬ating subsidiaries without bringing in additional capital). (e) Joint Venture Operating NBFCs that have 75% or less than 75% foreign investment will also be allowed to set up sub¬sidiaries for undertaking other NBFC activities, subject to the subsidiaries also complying with the applicable minimum capital inflow i.e., (b)(i) and (b)(ii) above. (f) FDI in the NBFC sector is put on automatic route subject to compliance with guidelines of the Reserve Bank of India. RBI would issue appropriate guidelines in this regard.

 

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[satya jyothi]

Okay, further when we refer the housing and real estate sector, it says only NRI's can invest.

 

So in that case a foreign company cannot invest i guess.

 

 

Regards,

 

On Fri, Jan 28, 2011 at 4:52 PM, R V SECKAR <rvsek...@gmail.com> wrote: