Tamil Nadu RERA Implements Three-Account Rule for Real Estate Projects from January 1, 2026

Effective January 1, 2026, the Tamil Nadu Real Estate Regulatory Authority (TNRERA) mandates a 3-bank-account model for all registered real estate projects to strengthen financial discipline and protect homebuyers' investments from fund diversion. 

How the 3-Bank-Account Structure Works 

As per the circular, promoters must open 3 distinct accounts in a single scheduled bank and branch. These accounts are: 

• RERA Designated Collection Account (100%)
• RERA Designated Separate Account (70%)
• RERA Designated Transaction Account (30%) 

All funds collected from homebuyers must first go to the collection account. At the end of each day, 70% is auto-transferred to the separate account, used solely for land and construction expenses. The remaining 30% goes to the transaction account, which handles refunds, interest payments, marketing, administrative costs, and penalties. 

Strict Withdrawal Conditions and Bank Oversight 

Withdrawals from the separate account are allowed only after submission of three specific documents: architect’s certificate (Form 1), engineer’s certificate (Form 2), and chartered accountant’s certificate (Form 3).  

These must also be uploaded to the TNRERA portal. Banks are mandated to enforce auto-sweeps and block any manual withdrawals from the collection account. 

In joint development agreements, promoters and landowners must each maintain their own set of 3 accounts. This ensures clear separation and tracking of all financial flows. 

Read More: Project Extension No Escape: MahaRERA Says Homebuyers Must Get Interest for Delayed Possession!  

Homebuyer Benefits and Traceability 

This system prevents cross-project fund usage and ensures homebuyers’ ₹ are directly traceable to specific project milestones. Refund provisions are also more secure as funds stay proportionate to project progress. Even builder-contributed capital and loans must go through the transaction account for added transparency. 

Reporting and Compliance Measures 

Developers must report details of any existing or new loans, including lender name, amount, disbursal details, and usage certifications from chartered accountants. Changes to any of the three accounts post-registration require prior approval. On project completion and TNRERA certification, the remaining balances can be withdrawn. 

Conclusion 

This initiative by TNRERA strengthens homebuyer fund security through a bank-controlled and regulation-driven structure. By ensuring automated tracking and restricted withdrawals, the system significantly limits fund mismanagement during project development. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities or companies mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

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