MahaRERA Mandates Separate Bank Accounts for Developers to Ensure Transparency and Accountability
The Maharashtra Real Estate Regulatory Authority (MahaRERA) has introduced new guidelines for developers to maintain separate bank accounts for project funds, ensuring transparency and accountability in financial operations.
MahareraReal Estate RegulationHome Buyers ProtectionTransparencyAccountabilityFinancial DisciplineReal Estate MaharashtraJun 27, 2024
The three accounts include the 'RERA Designated Collection Account' for 100% of revenue from flat buyers, the 'RERA Designated Separate Account' for 70% of funds allocated for project land and construction, and the 'RERA Designated Transaction Account' for the balance 30% of funds. This move aims to discontinue the practice of developers asking home buyers to deposit money in different bank accounts for various purposes.
MahaRERA Chairman, Ajoy Mehta, stated that the authority is committed to building trust among home buyers by legally empowering them to ensure their investments are secured and protected. The new guidelines will ensure financial discipline and transparency in project operations, enabling precise financial oversight in the real estate sector.
The directive is in accordance with Section 4(2)(i)(D) of the Real Estate (Regulation and Development) Act, 2016, which provides for dedicated bank accounts to ensure transparency, financial discipline, and better monitoring of transactions. The entire operating procedure has been defined for receipt, expenditure, and refund, ensuring that developers cannot excuse themselves from returning the booking amount to flat purchasers who intend to exit the project.
In case of cancellation of a flat's booking, the developer will be required to pay back 70% of the amount received, along with compensation for any losses, from the RERA Designated Separate Account. Interest on the amount will also be applicable.
The new guidelines will also restrict the misappropriation of funds, ensure transparency in fund utilization, and bring in financial discipline, ultimately helping in project timely completion. Additionally, developers will be required to declare loans availed from financial institutions against the mortgage of land or flats or the entire project, ensuring transparency and accountability in project finance.
Information
MahaRERA is a statutory body established under the Real Estate (Regulation and Development) Act, 2016, to regulate and promote the real estate sector in Maharashtra.
MahaRERA is committed to protecting home buyers' interests and promoting transparency and accountability in the real estate sector.
Frequently Asked Questions
What is the purpose of MahaRERA's new guidelines for developers?
The purpose is to ensure transparency, financial discipline, and accountability in project operations, protecting home buyers' investments.
How many bank accounts will developers be required to open?
Developers will be required to open three designated bank accounts in a single bank.
What are the three designated bank accounts for?
The accounts are for 100% of revenue from flat buyers, 70% of funds allocated for project land and construction, and the balance 30% of funds.
What happens in case of cancellation of a flat's booking?
The developer will be required to pay back 70% of the amount received, along with compensation for any losses, from the RERA Designated Separate Account.
Will developers be allowed to alter the bank account without MahaRERA's approval?
No, developers cannot alter the bank account without MahaRERA's approval.
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