SWAMIH Fund managed by SBI Capital Markets and SBICAPS Ventures, a subsidiary of State Bank of India (SBI) so far has approved INR 8,767 crore for 81 stalled residential projects. Among these residential projects, investment in 18 projects has got final clearance and disbursement of investment fund across 7 residential projects at various stages.
Special Window for Affordable and Mid-Income Housing (SWAMIH) Investment Fund I was set up in November 2019 as a ‘Special Window’ in the form of AIF (Alternate Investment Fund) to provide priority debt financing assistance for completion of stalled residential projects. SWAMIH Fund has been formed with a corpus of INR 12,500 crore with a Greenshoe option of INR 12,500 crore. This investment fund was formed at aimed at the completion of stalled residential projects, Brownfield, RERA registered residential projects that are affordable & mid-income category, are net worth positive, and require last-mile funding to complete construction development.
The approved fund will help real estate developers to complete around 60,000 housing units across the country. The final clearance of residential projects is from across mix of micro-markets and cities including large cities such as Mumbai Metropolitan Region (MMR), National Capital Region (NCR), Bangalore, Pune, and tier-II cities like Panipat, Lucknow, Jaipur, Nashik, Chandigarh, Surat, etc.
Apart from 81 residential projects clearance, another lot of 353 stalled housing projects are under examination for the provision of financial assistance. Furthermore, SWAMIH Fund is also effectively evaluating other options to provide alleviation to about 15,000 home buyers in certain long-stalled projects which are pending before the Supreme Court for resolution.
There are stringent control mechanisms is in place to bring transparency while spending SWAMIH Fund by real estate developers. Control mechanisms like Project Account Operated by Fund, Direct Payment to Contractors, Project Monitoring Consultant, Virtual Chief Financial Officer Control, Stipulation of Minimum Selling Price, and Due Diligence Mechanism to ensure 100 percent visibility on cash flows to mitigate the risk of fund diversion.
These mechanisms will bring accountability, monitoring of project progress, and greater transparency in the sector. Ultimately, home buyers will be benefitted from these discreet steps by early completion of the stalled residential projects.