Mumbai: BMC reduces interest rates on instalments of payment for various building permissions

Ahead of Maharashtra Assembly elections, the Brihanmumbai Municipal Corporation (BMC) has rolled out further concessions to builders. In an attempt to revive the real estate sector, the BMC, on Tuesday, reduced the interest rates on instalments of payment for various building permissions.

According to the Hindustan Times, the civic body approved concessions on interest rates in case payment of the premium amount by builders is done in instalments under development control regulations (DCR). The BMC has also reduced the interest rate for default payment of premiums by builders. In a circular issued by the development plan department of the BMC, it stated, “Instalment facility is proposed to be modified by reducing the rate of interest from 12% to 8.5% on reducing balance instalments.”

Besides, in case of default in the payment of the instalment with interest on due date, the interest rates will be reduced from 18 per cent per annum to 10 per cent per annum for the first six months from the scheduled date. For the next six months, it will be 12 per cent. The circular added, “Also, where there is a default in the payment of the instalment amount with interest, the interest on the differed payment is proposed to be reduced from 18% to 10% per annum for the first six months from the scheduled date; and thereafter, 12% for a further six months.”

BMC chief Praveen Pardeshi told the Indian Express, “The move will help homebuyers, as the builders can pay instalment with less interest rates and sell flats at lower costs. We are assuming that revenue will increase and incomplete projects will get boost.”

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