RBI MPC Policy: From raising home loan limits to enhancing digital payments, here are 5 key announcements Governor Shaktikanta Das made

While announcing its monetary policy decision on Wednesday, the Reserve Bank of India has also proposed a slew of new measures to strengthen the realty/Infrastructure as well as to enhance the digital payments segment. 

The RBI Governor Shktikanta Das announced developmental and regulatory policies in his commentary during June bi-monthly monetary policy.  

The central bank raised the interest rate by 50 basis points to a two-year high of 4.9 per cent as it doubled down to tame inflation that has surged in the last couple of months. All the six members of the Monetary Policy Committee (MPC), headed by RBI Governor Das, unanimously voted for the latest rate hike. 

Below are the list of top five developmental policies that RBI announced during June policy decision: 

Individual Housing Loans by Cooperative Banks – Enhancement in Limits 

Taking into account the increase in housing prices since the limits were last revised and considering the customer needs, it has been decided to increase the existing limits on individual housing loans by cooperative banks.  

Accordingly, the limits for Tier I /Tier II Urban Co-operative Banks shall stand revised from Rs 30 lakh/ Rs 70 lakh to Rs 60 lakh/ Rs 140 lakh, respectively. As regards Rural Cooperative Banks, the limits shall increase from Rs 20 lakh to Rs 50 lakh for RCBs with an assessed net worth less than Rs 100 crore; and from Rs 30 lakh to Rs 75 lakh for other RCBs.  

Permitting Rural Co-operative Banks (RCBs) to Lend to Commercial Real Estate - Residential Housing (CRE-RH) Sector 

Considering the growing need for affordable housing and to realise their potential in providing credit facilities to the housing sector, it has been decided to allow State Co-operative Banks and District Central Co-operative Banks to extend finance to Commercial Real Estate – Residential Housing (CRE-RH) within the existing aggregate housing finance limit of 5 per cent of their total assets.  

Permitting Urban Cooperative Banks (UCBs) to Offer Door-step banking 

In order to attain harmonization of the regulatory framework across REs and to provide convenience of banking services to the customers at their doorstep, it has been decided to permit UCBs to extend doorstep banking services to their customers on par with scheduled commercial banks.  

e-Mandates on Cards for Recurring Payments – Enhancement of Limit 

It is proposed to enhance the limit from Rs 5,000 to Rs 15,000 per recurring payment to further augment customer convenience and leverage the benefits available under the framework. Requests received from stakeholders to increase the limit under the framework to facilitate payments of larger value like subscriptions, insurance premia, education fee, etc. 

Major banks are providing the facility and the transaction volumes are seeing good traction. Till date, over 6.25 crore mandates have been registered under this framework, including for over 3,400 international merchants. 

Enhancements to Unified Payments Interface (UPI) – Linking of RuPay Credit Cards 

In order to further deepen the reach and usage of digital payments through UPI, it is proposed to allow the linking of credit cards to UPI. To start with Rupay credit cards will be enabled with this facility.  

This arrangement is expected to provide more avenues and convenience to the customers in making payments through UPI platform and this facility would be available after the required system development is complete.