NHB Forensic Audit Tender Targets Udaipur Lender Reported as SRG Housing Finance

What the NHB has published

The NHB's request for proposal, reference NHB/HO/DOS/2026/00001, is dated 03-10-2026 and covers the forensic audit of a non-deposit taking housing finance company based in Udaipur, Rajasthan. The RFP title does not name the company, and the tender does not name the company, though it is reported to target SRG Housing Finance following allegations of ₹300 crore to ₹400 crore of potentially fictitious loans.

The NHB's list of housing finance companies granted a certificate includes SRG Housing Finance Limited at 321, S.M. Lodha Complex, Near Shastri Circle, Udaipur – 313001, which is the basis for the link reported in the media. The NHB has not publicly named SRG in the tender documents reviewed for this article.

What the reports allege

The allegations come from media reports, not from a published NHB order. According to people familiar with the matter, the NHB has red-flagged its exposure to the Rajasthan-based lender after an investigation identified suspected fictitious loan accounts worth around INR 300–400 crore. The investigation also pointed to alleged evergreening of loans, manipulation of non-performing asset figures and the possible routing of funds to promoter-linked entities.

The same report states that NHB has classified the account as a Red Flagged Account (RFA) and reported it to the Reserve Bank of India's Central Repository of Information on Large Credits (CRILC). It also notes that an RFA classification does not by itself constitute a declaration of fraud. The lender had not responded to queries at the time of that report.

What SRG Housing Finance has said

SRG has denied the reports. On October 5, 2026, the company told the stock exchanges that it had received no official communication regarding the initiation of any such forensic audit. The company has also described the NHB's review as a supervisory process. Management described the red flag classification as part of a routine supervisory process that does not declare fraud.

According to the company's transcript of a September investor meeting, the National Housing Bank audit started in July 2026. The company also says it is reporting growth in its AUM and is planning to convert to an NBFC-ICC. On August 20, 2026, the company's Board approved a proposal to transition from a Housing Finance Company (HFC) to a Non-Banking Financial Company - Investment and Credit Company (NBFC-ICC), subject to RBI and regulatory approvals.

What it means for borrowers, investors and the market

SRG is a housing finance company, not a property developer. Its main exposure for buyers is as a lender, so the questions that matter are about loans it has sanctioned or may sanction. The sources reviewed for this article do not describe changes to existing loan terms or repayment schedules. Borrowers with an SRG loan should confirm terms directly with the lender.

For investors, the position is unresolved. The NHB tender shows the regulator has started procuring an audit. The allegations of suspected fictitious loans are unverified and come from unnamed sources. The company denies them. No audit findings have been published as of this date.

What happens next

The next dated steps are the bid deadline on 13 October 2026 and the opening of commercial bids on 14 October 2026, both listed in the NHB's RFP. The NHB will then select an audit firm. Whether the audit covers SRG, and what it finds, has not been confirmed by the NHB in the documents reviewed. The company's planned conversion to an NBFC-ICC remains subject to RBI approval.