Affordable Housing Finance Turning People's Real Estate Dreams into Reality The demand for real estate continues to soar and housing finance is assisting the segment

With the advent of increasing urbanization and growing migration to Tier I and Tier II cities, providing the right product to suit the right customer has become a matter of paramount importance. The next stage of growth is going to come from the affordable sector. A significantly large portion of the population falls under this. For which cities need to provide housing units to cater to this demand. The new middle class is on the rise and with increased demand in housing, will come the need to finance these units. In addition to this, digitization of property titles by respective state governments is the need of the hour and new technologies like Blockchain should be adopted by the government and the industry to make this possible.

Owning years of experience in Banking and Finance helped the founder of Subham Housing Development, Sanjay Chaturvedi to gather such necessary insights while establishing his company.

"While it was not an easy decision to take, the opportunity on how we could use our learnings, work with a completely new segment; provide a new service and a different underwriting paradigm was a great boost to get started. Having a good understanding of business drivers and risks was of immense help and contributed to us hitting the ground running," the founder explains reflecting upon his new start that he undertook a little more than nine years ago.

Chaturvedi has uniquely positioned his company as a housing finance provider to those who are currently not under the scope of the formal credit system. A loan from Shubham avails customers with a wide range of their financial services.

In an interview with BIZ Experiences India, he shares more such insights about how housing has always been a very important aspect of economic growth.

The Climb of Housing Finance

With major developed countries looking at Mortgage to GDP ratios as a key a success factor to showcase growth. "Historically one can broadly classify the retail housing market into one where we have commercial and co-operative banks and another where we have specialized agencies called Housing Finance companies formed with the core focus of providing home loans. Naturally, banks have played a key role due to their vast branch network," he states. However, he also specifies that with the advent of the National Housing Bank in 1988, whose functions include regulation & supervision of housing finance companies, financing, and promotion & development of housing finance in India.

"Between 1988 to 2010 there were 48 registered housing finance companies interested in this sector that has grown in the last decade largely due to policy initiatives and the growing demand in housing, especially in Urban/Semi-urban areas. This has led to the number of Housing Finance companies grow to 91 in 2018," he lays down the facts confirming the growth in the sector. With the market opening up and more and more domestic and foreign players showing interest, a lot of these Housing Finance Companies are either backed by professional investors or large parent companies. With more players in the market, the end consumer has a multitude of options to choose from and get the best terms possible.

Future

Since its inception, the housing finance organization has disbursed more than INR 2,300 crores to 32,000 families across 12 states and 85 cities, and Chaturvedi believes that it is "a testimony to our hard work and perseverance" bringing an impact in the lives of their customers.

What has the founder got to say about its way ahead? "Our vision is to build a billion-dollar book in the next 3 – 4 years. We have a reach of 90 branches across 12 states with the aim of consolidating more within our current geographies. We aim at touching 100,000 families in the next few yrs. Along with building up our branch teams, we are actively focused on bringing superior customer experience. Expansion through our partner network and focus on the digital outreach program is on the cards as well. A continuous focus will be on improving delinquency numbers and leveraging our data to provide new products and revenue opportunities," he concludes highlighting his company's way ahead.