New Delhi: First it was the Reserve Bank of India and then the central government that asked banks to cut interest rates for home loans. Public Sector Banks have cut home loan rates by up to 300 basis points between October and December 2008. However, according the finance ministry data, the sector witnessed a credit growth of only 2.49% between 7 November 2008 and 16 January 2009.
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Experts say growth in housing finance has not trickled down to the lower income sections. National Housing Bank, the nodal agency for refinancing and regulator for refinancing housing loans, plans to join hands with NGOs to propagate housing loan schemes for the weaker sections. Analysts say only by constructing affordable housing will the housing market gather momentum.