How do you see the thrust on affordable housing in this budget play for your business?
Affordable Housing segment is one of the fastest growing segments with a CAGR of 18-20%. The growth will receive a further push with the focus on this segment by the present government and the budget. The combination of PMAY – “Housing for All”, increase in the loan size under the CLSS, infrastructure status and faster approval mechanism will provide a huge boost to this segment. Consequently, around 90% of demand for Affordable Housing will be from the low and the mid income groups which we at Aditya Birla Housing Finance Limited are positioned to serve. We have business lines and the geographical reach to provide lending solutions, right from lending to the builders to helping the consumer buy the property. To help us achieve this we have set up a team dedicated to serve the affordable housing segment and expect a lot of traction and growth from this segment.
What is the underwriting practice in case of affordable housing and how much does this segment contribute?
The customer demographic is different from your traditional housing segment, both in terms of the customer profile and nature of the property. Majority of the customers are first time and end use buyers. Our underwriting methods are tailor-made as each customer segment and geography has very unique characteristics. Our team spends time with customers to understand their business model, spending habits, assets built while also helping them through the process of purchasing the property as majority are first time buyers and unaware of the procedures involved. In the next couple of years 35-40% of our customers will be from Affordable Housing segment.
How different are you compared to others?
Aditya Birla Group provides us with an unparalleled reach and access to the affordable housing segment within its ecosystem which is spread across varied segments spanning Manufacturing, Telecom, Apparel, Cement and Financial Services. Anchored by about 12,000 employees and trusted by over 12 million customers, the Aditya Birla Financial Services Group itself has over 1,650 points of sales across multiple asset classes providing us with a huge base of potential customers and business partners. Our in-depth understanding of the customer, complete suite of products, customised credit underwriting and digitally focused offering will help us deliver a superior product to the customer.
Rakesh Singh, Director, Aditya Birla Housing Finance Limited