To monitor the financial health of the private developers executing realty projects in the city and to ensure timely payment, the Greater Noida Industrial Development Authority will ask builders to open escrow accounts now on.
The Authority took the decision to implement the system after recently getting an approval from the board. Home to 207 group housing projects, the Greater Noida Authority has to recover dues to the tune of over Rs 7,000 crore from the private developers executing the multi-storey apartment projects in the city.
Officials said these developers will now have to set up an escrow account for every project. The funds collected from the buyers will be utilised for further construction work or for ensuring payments related to the same project. The Authority will also seek its payment from the developers towards the land premium, they said.
“Only completed projects will be kept out of the purview of the order. However, the incomplete ones will have to open escrow accounts,” said GNIDA additional CEO Deep Chandra.
Developers have welcomed the move. Chairman of National Real Estate Development Council (Uttar Pradesh) RK Arora said, “The move will ensure timely completion of realty projects and revive confidence in the sector.”