JOIN USState Bank of India (SBI) and the German Development Bank KfW have concluded a loan facility of approximately Rs 1,800 crore ($274 million) to support lending for affordable housing in India.
The promotional loan has a maturity of 15 years. With its focus on housing loans for economically weaker sections (EWS) and lower income group (LIG) households, the facility is designed to complement the Government of India’s flagship affordable housing programme, the Pradhan Mantri Awas Yojana.
These lower income household categories account for 95% of the estimated shortage of 20 million housing units in the country. The entire process of fund raising was facilitated by SBI’s subsidiary, SBI Capital Markets, the bank said.
SBI deputy managing director Siddhartha Sengupta signed the agreement on behalf of SBI, while KfW was represented by member of the executive board Norbert Kloppenburg and member of the management committee of KfW Development Bank Roland Siller.
“Sustainable mortgage loans to low income families to purchase, build or upgrade their homes are critical for inclusive growth and development. Partnering with India’s largest bank on this mission provides a tailor-made platform for quick upscaling of housing finance for this segment,” Kloppenburg said.
“SBI is committed to support the government’s mission of Housing for All, and this facility will be additional impetus to support this mission,” Sengupta said.