Housing finance companies yet to follow NHB diktat on uniform rates

There are some others who say that it has to be done simultaneously with banks and HFCs so that there is a level-playing field.

“HFCs have to follow it once NHB has issued a circular. We have given them some time to change their respective processes but it is already two months now and they should adhere to the circular,” said RV Verma,chairman and managing director,NHB.

Companies like HDFC have not even informed their branches about the new circular. “We are not aware of any such new guideline. If an old customer has to shift to the rates being offered to the new customers,a fee would be applicable,” said an HDFC executive at a Delhi branch.

“It is advised that the HFCs should ensure uniformity in rates on floating rate basis,charged to their old and new customers,with the same risk profile,irrespective of the time of entry of the borrowers,” said the NHB circular issued on October 19 to all registered HFCs. “Charging of higher interest rate to the old customers against the new customers puts them to a great disadvantage,besides the practice being discriminatory.”

“Customers cannot be denied benefits through competition in the housing loan market. We have received complaints from customers of some HFCs and we are looking into the matter,” Verma said.

While HFCs are yet to implement the NHB advisory on charging uniform floating rates from both old and new customers of same risk profile,the RBI is pursuing the same with banks and wants them to take it up on their own.

“We are pursuing this issue with the banks on a continuous basis and want the banks to implement this on their own as a measure of good customer service,” said a senior RBI official.

While banks are resisting the move,a source close to the development said that if need arises,the RBI may issue a directive on the same. Banks are learnt to be saying that this will create asset liability mismatch to which the regulator has told them to manage it and also told them that this can’t impact their large balance sheet.

In the current environment,while a new customer is being offered a loan at 10.75-11 per cent,an old customer is being charged anywhere from 11.75 to 13 per cent.