IIFL Home Finance signs USD 68 million loan with ADB to boost affordable green housing in India

IIFL HFL, India's fastest growing digital first home finance company, has signed a USD 68 million loan with ADB to improve financial access to affordable green housing for lower-income groups in India.

The funding comprises a direct ADB loan of up to USD 58 million and a USD 10 million concessional loan by the Canadian Climate Fund for the Private Sector in Asia (CFPS). From ADB's loan, 80% will be earmarked for lending to women borrowers or co-borrowers and 20% will be allocated to financing mortgages for green-certified homes. The CFPS loan will support IIFL HFL's green housing portfolio, specifically towards incentivising developers to adopt green certification standards in building affordable housing.

Speaking on the agreement Mr. Monu Ratra, MD & CEO, IIFL HFL said, "Funding from ADB will help us to improve the penetration of green affordable housing in deeper markets of India and fulfill the dreams of many Indian families to own their own homes. We are glad to be partnering with ADB in our growth journey."

To accelerate initiatives that improve access to green affordable housing for meeting the targets of Sustainable Development Goals 2030, it is important to actively pursue issues related to climate resilience, sustainability-orientated thinking and the achievement of gender-balance as fundamental approaches to development. Additionally there is a need to address lack of awareness around green homes.

"By leveraging IIFL HFL's focus on financial inclusion and CPFS' leadership on climate-resilient housing, ADB can help low-income communities to manage the impacts of climate change," said ADB Director General, Private Sector Operations Suzanne Gaboury. "We are pleased to support IIFL in demonstrating to the construction industry that you can build both affordable and green-certified housing for low-income households."

In alignment with Government of India's commitment towards 'Housing for All', IIFL HFL provides affordable home loans to Economically Weaker Section (EWS), Low Income Group (LIG) and Middle Income Group (MIG). Home loans have been disbursed to over 1,40,000 borrowers as on Sept 30th, 2021.

Additional complexities are faced by one of the major target groups for this programme, women often find it difficult to obtain mortgage loans in India. This is cause of concern as lack of property ownership contributes to low social status of women, their vulnerability to poverty and low bargaining power within households. To counter this, of late however, there is an increasing focus on women ownership in housing as observed through guidelines of various housing schemes such as Credit-Linked Subsidy Scheme - Pradhan Mantri Awas Yojana (Urban) (CLSS-PMAY-U) and in-situ slum redevelopment, but there is a need to empower women further and shift their role from key stakeholder to a key decision maker.

To this effect, the loan agreement is supplemented by a technical assistance (TA) grant of upto USD 1 million for supporting the green building ecosystem in the affordable housing sector in the country. This is ADB's first such private sector agreement in the country. Aiming to enable activities addressing some of the key identified obstacles for building the ecosystem for green certified and affordable housing. IIFL HFL shall also contribute an additional amount of up to USD 1,50,000, for supporting the above mentioned activities and objectives as described in the TA agreement. IIFL HFL has already been propagating green affordable housing in India through its platform 'Kutumb', which is a green building initiative addressing the affordable housing projects regarding issues relating to financing, technical know-how of green construction and certification and Environmental, Social and Governance (ESG) compliance.

IIFL HFL in the recent past announced milestone of facilitating over 50,000 households under CLSS making it one of the leading FIs contributing towards PMAY-U. The company has been able to disburse subsidy of over Rs 1,200 crore to households since the launch of the scheme in June 2015.

Shares of IIFL Finance Limited was last trading in BSE at Rs. 319.80 as compared to the previous close of Rs. 317.50. The total number of shares traded during the day was 30245 in over 951 trades.

The stock hit an intraday high of Rs. 323.35 and intraday low of 315.00. The net turnover during the day was Rs. 9664258.00.

Source : Equity Bulls

Keywords

IIFLFinance INE530B01024 IIFLHomeFinance ADB FinancialAccess GreenHousing