The Alternate Investment Fund i.e. AIF is a new corrective measure introduced by the Union Government to give homebuyers a relief. This is a stress fund investment vehicle formulated to collect funds from multiple investors while performing under the framed guidelines of the Reserve Bank of India (RBI). The Government has opened the fund with a sum of Rs. 25,000 crores and plans to raise the remaining funds from other players such as SBI, LIC and others who have expressed interest in the Alternative Investment Fund.
So, after understanding the concept of AIF, go through the below-mentioned frequently asked questions now:
Q: What are Net worth Positive Projects?
A: In these projects, the cost of receivables and unsold inventory is more than the total of completion cost and outstanding liabilities. An investment manager assesses the present scenario of the project to accumulate its condition from the revenue prospect. On the whole, the project must offer a positive revenue statement to be eligible for special funding.
Q: Will the developers be able to repay the homebuyers with the help of this AIF fund?
A: According to the records, approximately 90 percent of the ongoing residential projects in Delhi NCR have defaulted on payment to authorities, banks, and homebuyers. However, the fund introduced by the Government primarily aims to complete the construction of stalled residential projects. The funds cannot be used to wave-off any other liability.
Q: Which regions/cities will mostly benefit from the Alternate Investment Fund?
A: This fund will be used for the completion of projects under which unit size within 200 sq m carpet area and the unit cost limits to not more than Rs 2 crore in the MMR region and Rs 1.5 crore in Bangalore, NCR, Chennai, Kolkata, Pune, Hyderabad, and Ahmedabad.
In the case of Tier-II cities, the unit cost must not exceed over Rs. 1 crore to utilize the alternative investment fund.