Affordable housing drives home loans

Though the overall pace in the growth of home loans is coming down, the loans meant for affordable housing have surged at a robust compounded annual growth rate of 23% over the last five years, as per the latest market insights report from TransUnion Cibil, India’s first credit information company.

Home loans which have a ticket size less than Rs 10 lakh are classified under affordable housing loans.

The sanctioned lending amount in the calendar year 2016 for affordable housing was close to Rs 30,400 crore given to around 7.5 lakh borrowers.

Even more encouraging is the fact that this growth has come while keeping the delinquency rate firmly in control at levels of around 1%.

The ticket size of these loans has been decreasing from Rs 4.8 lakh in 2009-10 to Rs 4.1 lakh, possibly suggesting the credit industry’s success on the financial inclusion drive.

“This augurs well for the national priority of financial inclusion and credit penetration as it implies that more and more consumers from the bottom of the pyramid are gaining access to finance,” said the Cibil report.

“The golden lining is that there have been low delinquency rates on affordable housing loans over the last five years. The essence of these …read more