Explained: What is SWAMIH-2, and how will it help stalled housing projects?

The government is finalising the contours for a second Special Window for Affordable and Mid-Income Housing (SWAMIH-2) fund and is expected to operationalise it soon to provide last-mile financing for stalled residential projects, PTI reported citing people familiar with the matter.

The proposed fund, with a target size of ₹15,000-crore, is expected to bring relief to nearly one lakh middle-class homebuyers whose investments are stuck in delayed projects even as they continue to service home loan instalments, according to the report.

What is SWAMIH?

SWAMIH stands for the Special Window for Affordable and Mid-Income Housing. The original SWAMIH Investment Fund was created as a social impact fund to provide last-mile financing to housing projects that were stuck despite being largely sold to buyers.

Sponsored by the finance ministry and managed by SBICAP Ventures Ltd, a State Bank of India group company, the fund is widely seen as a lender of last resort for distressed projects. It considers projects by first-time developers, established developers with troubled projects, cases involving litigation, customer complaints and even non-performing accounts.

Why is a second fund being planned?

While SWAMIH helped revive several projects, the scale of stalled housing in India remains large. A 2019 study by data analytics firm PropEquity, commissioned by SBI Ventures Ltd., estimated that around 1,500 housing projects comprising about 4.58 lakh units were stalled or stressed, requiring nearly ₹55,000 crore to complete.

The new SWAMIH-2 fund seeks to address this funding gap and extend support to another set of delayed projects.

In the Union Budget 2025–26, Finance Minister Nirmala Sitharaman announced that the government has earmarked ₹1,500 crore as seed capital for the new fund. Sitharaman said that under SWAMIH, 50,000 dwelling units in stressed projects have already been completed and handed over to homebuyers, while another 40,000 units are slated for completion in 2025.

Mandates for the new fund are being finalised, and soon, clearance would be granted, sources said, adding that it would provide last-mile funding for commercially viable projects and unlock investment in stalled residential projects.

Currently, the Fund has about 30 investment professionals, with an average of 15 years of industry experience.