What is NHB (National Housing Bank)?

National Housing Bank (NHB) is a statutory body set up under the National Housing Bank Act, 1987, and is a wholly-owned subsidiary of the Reserve Bank of India (RBI). NHB serves as the apex regulatory and refinancing institution for housing finance in India.

Role of NHB

• Regulator: Supervises and regulates Housing Finance Companies (HFCs) in India.
• Refinancer: Provides refinance (liquidity support) to banks and HFCs for housing loans at concessional rates.
• Promoter: Promotes housing finance institutions and affordable housing initiatives.
• Policy Advisor: Assists the government in formulating housing finance policy.

Key Functions

• Registers and regulates HFCs — entities like HDFC, LIC Housing Finance, PNB Housing Finance etc. are regulated by NHB.
• Operates the PMAY-CLSS nodal agency function — channels subsidies to beneficiaries.
• Maintains Residex — India's official residential property price index.
• Provides direct lending for slum improvement and affordable housing projects.

NHB vs. RBI for Housing Finance

• RBI: Regulates banks' housing loan portfolios.
• NHB: Regulates non-bank housing finance companies (HFCs).

Note on Regulatory Change

In 2019, the regulatory oversight of HFCs was transferred from NHB to RBI, though NHB continues its promotional and refinancing role.

NHB plays a foundational role in India's housing finance ecosystem. For borrowers, NHB's refinancing support helps keep home loan rates competitive, while its CLSS nodal agency function ensures that PMAY subsidies reach eligible beneficiaries efficiently.