The Reserve Bank of India (RBI) has recently fixed the minimum Net Owned Fund (NOF) size for housing finance companies (HFCs) at Rs 25 crore.

Explanation:
- The Net Owned Fund (NOF) is a measure of a company's net worth, which is calculated by deducting the total liabilities from the total assets.
- The RBI has set a minimum NOF requirement for HFCs to ensure that these companies have sufficient capital to carry out their operations and meet their financial obligations.
- The minimum NOF size for HFCs has been increased from the previous requirement of Rs 10 crore to Rs 25 crore.
- This increase in the minimum NOF size is aimed at strengthening the financial stability of HFCs and ensuring their ability to withstand any financial shocks.
- The RBI has also stated that HFCs which do not meet the minimum NOF requirement within the given timeline will not be able to accept public deposits or renew existing deposits.
- This move by the RBI is in line with its efforts to regulate and supervise the housing finance sector more effectively, as HFCs play a crucial role in providing long-term funding for the housing sector.
- The increase in the minimum NOF size will help to ensure that only financially sound HFCs are operating in the market, thereby reducing the risk of defaults and improving the overall stability of the housing finance sector.
- It will also help to enhance investor confidence in the housing finance sector and promote the growth of sustainable and responsible lending practices.
- HFCs are now required to comply with the minimum NOF requirement by March 31, 2022.
- Overall, this move by the RBI is expected to strengthen the housing finance sector and contribute to the growth and development of the Indian economy.