Dirty money, clean slums

Laundered money will be used to clean slums in 454 towns. Black money to the tune of Rs 63 crore, which was deposited last year with the National Housing Bank (NHB) for immunity under the Voluntary Deposits Scheme, will be used to establish a revolving corpus to refinance loans given by state governments to slum families. The catch, however, is that the states will receive amounts in proportion to the deposits made by their inhabitants. Thus, slum-dwellers in Uttar Pradesh, West Bengal, Andhra Pradesh and Bihar would benefit the most from the scheme.

Only families with a total monthly income of less than Rs 1,050 will be eligible for these loans, which are intended to help them improve their dwellings. Cooperatives and non-governmental organisations can also claim these loans for community development schemes. NHB is taking care that its black money deposits do not go down the drain. To prevent the initial corpus from being eroded, the recipients will be charged an annual interest of 10 per cent.