Satin Creditcare will this month foray into housing finance business, offering loan below Rs 10 lakh, with an aim to tap unorganised market in rural and semi-urban areas.
Satin Creditcare Network (SCNL) provides collateral free, micro-credit loans to economically active women in rural and semi-urban areas, individual businesses, MSMEs, among others. The company has created a wholly owned subsidiary in April this year to enter housing finance business.
"We are trying to create a niche for ourselves. In micro- finance space, I think rural sector is far more critical and it is the biggest environment where we work in. For housing finance, we are going to target the same specific geography and the same specific segment (we serve as micro-finance company)," SCNL Chairman and MD H P Singh told PTI in an interaction.
He said the company will get into housing finance anytime this month as the blueprint is ready and the whole team is also in place.
"We are starting with Rajasthan and outskirts of Delhi for now, then we will probably look at other areas. Our own sense is that the average loan size would be Rs 5-7 lakh. It means our major thrust would be below Rs 10 lakh loan size," Singh said.
The market is very big in this segment, Singh said, adding that the company probably is scratching the surface of very "niche" segment as otherwise there is no such formal credit facility for them to buy or build houses.
Most of the housing finance companies are concentrated on major metro cities, nobody has gone down to the rural space.
"If you look at this rural asset, it has not even been monetised. Whatever monetisation has happened is in the unorganised market. If you have a piece of land or have a small house in a tier 4 or 5 city or village, you will go to an unorganised market to get money at higher rates," Singh said.
Present across 18 states now with recent penetration into Assam and Odisha, southern states are the only geographies that remain untapped by the company.
There are no immediate plans to enter this region, Singh added.
The Gurugram-headquartered microfinancier has recently raised a substantial capital from various sources, both through equity and debt, to expand the existing business and foray into housing loans.
"The fund raising for us is more of the growth capital. We are now looking for growth in housing finance," Singh said.
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