Urban Challenge Fund (UCF)

Union Minister for Housing and Urban Affairs Manohar Lal launched the Operational Guidelines for the Urban Challenge Fund (UCF) along with the Credit Repayment Guarantee Sub-Scheme (CRGSS), aimed at transforming urban infrastructure financing across the country.

Key Highlights

The Urban Challenge Fund, with a total Central Assistance of ₹1 lakh crore, is designed to catalyse investments of nearly ₹4 lakh crore, marking a shift towards market-driven urban development.

The initiative represents a new approach to urban growth by leveraging public funds to attract larger investments and make cities financially sustainable.

The Fund will support projects in areas such as redevelopment of old city areas and markets, urban mobility and last-mile connectivity, non-motorised transport, water and sanitation infrastructure, and climate-resilient development.

Under the scheme, Central Assistance will be limited to 25 per cent of the project cost, while at least 50 per cent of funding will be mobilised through market-based mechanisms such as municipal bonds, bank loans, and public-private partnerships.