Banks and housing finance companies (HFCs) together logged 20 per cent growth in home loans in FY2014, the same as in the previous year, according to RV Verma, Chairman and Managing Director, National Housing Bank.
In absolute terms, home loans disbursed by banks and HFCs collectively increased by Rs. 1. 60-lakh crore in FY2014 to Rs. 9. 60-lakh crore as at March-end 2014.
Verma said, "We expect the growth (in home loans) to continue. There is every reason to believe that."
The mortgage guarantee product, launched by the India Mortgage Guarantee Corporation (IMGC), will give the housing industry a leg up, he added.
Banks account for 65-66 per cent of the overall Rs. 9. 60-lakh crore housing loans in the country and the balance is accounted for by HFCs.
The NHB chief said in FY2014, the average home loan size for HFCs and banks increased to Rs. 18-19 lakh (Rs. 16 lakh previous year) and Rs. 12 lakh (less than Rs. 10 lakh), respectively.
NHB expects to end the current financial year (ending June 2014) with a refinance disbursement of Rs. 20, 000 crore against Rs. 17, 400 crore in the year-ago period.
Verma said NHB has disbursed Rs. 13, 000 crore by way of refinance till March-end and expects to disburse another Rs. 7, 000 crore in the last quarter (April-June).
He said NHB is examining the manner in which the refinance window can play a role in encouraging lenders to take guarantees on their loan portfolios.
The NHB chief said: "We are moving from a mandatory to a more incentive-based refinance regime. "
"So, we will explore the possibility of how guarantee incentive can be built into our refinance portfolio for the lenders so that they can reach out to certain segments where they are not moving."
Meanwhile, IMGC, India’s first mortgage guarantee company, has concluded its first mortgage guarantee contract on a pool of priority sector home loans (aggregating Rs. 37. 8 crore) of Dewan Housing Finance Ltd (DHFL).