How are NBFCs providing housing loans in India? What is its impact?


Non-Banking Financial Companies (NBFCs) have become noteworthy entities in the financial sector, especially in the realm of home loans. Through their inventive products and customer-focused strategies, NBFCs play a crucial role in turning the aspirations of homeownership into reality for a broad spectrum of the population. This article delves into the essential characteristics and advantages of NBFC home loans, providing insights into how these institutions are transforming the housing finance sector.

Flexible eligibility criteria

In contrast to conventional banks, Non-Banking Financial Companies (NBFCs) frequently embrace a more adaptable stance on eligibility criteria for home loans. This flexibility allows a wider range of individuals, including those with unconventional income sources or lower credit scores, to meet the requirements for home financing. This flexibility has expanded opportunities for a more diverse group of prospective homeowners.

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Quick and streamlined processes

NBFCs are known for their agile and streamlined processes. From the approval application, the timeline for obtaining an NBFC home loan is often shorter compared to traditional financial institutions. The use of technology, such as online application platforms and instant document verification, contributes to a hassle-free and efficient experience for borrowers.

Innovative products

NBFCs frequently introduce innovative home loan products tailored to meet the specific needs of various customer segments. These may include custom EMI structures, step-up or step-down repayment plans, and hybrid loan options. Such flexibility allows borrowers to choose a plan that aligns with their financial goals and capacity.

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Focus on under-served segments

NBFCs have demonstrated a commitment to serving under-served segments of the population, including individuals in rural or semi-urban areas. By reaching out to these communities, NBFCs contribute to financial inclusion and help bridge the gap in homeownership opportunities across regions.

Competitive interest rates

With the ability to adapt quickly to market conditions, NBFCs often offer competitive interest rates on their home loans. This affordability factor enhances the attractiveness of NBFCs as a viable alternative for borrowers seeking cost-effective financing options.

Personalised customer service

NBFCs are renowned for their personalised approach to customer service. Borrowers often find that NBFCs are more responsive to their individual needs and concerns, providing a more tailored experience throughout the loan lifecycle. This focus on customer satisfaction contributes to building trust and loyalty.

Also Read: 5 Ways to pay home loan faster

Diversified collateral options

In addition to traditional collateral options, NBFCs may accept a broader range of assets as collateral for home loans. This can be particularly advantageous for individuals who may have assets other than property to secure their loans.

List of NBFCs providing housing loans in India

Here is a list of some prominent NBFCs in India that have been known to offer housing loans:

Housing Development Finance Corporation Limited (HDFC Ltd)

HDFC is one of the largest and most well-known NBFCs in India, specialising in housing finance.

LIC Housing Finance Limited

LIC HFL is a subsidiary of Life Insurance Corporation of India and is a prominent player in the housing finance sector.

Bajaj Housing Finance Limited

Bajaj Housing Finance is a part of the Bajaj Finserv group and offers a range of housing finance products.

Piramal Capital and Housing Finance Limited

Piramal Capital and Housing Finance is a diversified financial services company, and it provides various financial solutions, including housing finance.

Indiabulls Housing Finance Limited

Indiabulls Housing Finance is known for providing home loans and related services.

DHFL (Dewan Housing Finance Corporation Limited)

DHFL, now part of the Piramal Group, was historically one of the prominent NBFCs providing housing finance.

Edelweiss Housing Finance Limited

Edelweiss Housing Finance is a subsidiary of Edelweiss Group, offering a range of housing finance products.

Tata Capital Housing Finance Limited

Tata Capital Housing Finance is a part of the Tata Capital group and provides housing loans and related services.

Reliance Home Finance Limited

Reliance Home Finance is part of the Reliance Capital group and offers various housing finance solutions.

Muthoot HomeFin (India) Limited

Muthoot HomeFin is part of the Muthoot Pappachan Group and provides housing finance services.

Shriram Housing Finance Limited

Shriram Housing Finance is a subsidiary of Shriram City Union Finance and offers housing finance solutions.

Aditya Birla Housing Finance Limited

Aditya Birla Housing Finance is a part of the Aditya Birla Capital group, providing various financial services, including housing finance.

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