State-owned SBI and realtors' body CREDAI have signed an agreement to provide loans at a concessional rate to builders as well as customers for affordable housing projects. SBI and CREDAI have signed a memorandum of understanding (MoU) to collaborate and work towards the development of the real estate sector, specifically through the affordable housing and green housing projects.
The duration of the agreement is for a period of three years, State Bank of India (SBI) said in a statement. "We have signed an MoU with CREDAI. We will be providing 10 basis points concession to home buyers and 10-35 basis points to CREDAI's developer members," SBI Managing Director (National Banking Group) Rajnish Kumar told Press Trust of India.
He said SBI is a major player in home loans segment with 25 per cent market share. Earlier this month, CREDAI had announced that its members are launching 373 affordable housing projects comprising 2.33 lakh units with an investment of over Rs. 70,000 crore.
SBI, the county's largest bank and mortgage lender, will support CREDAI as their national banking partner and provide loans at concessional interest rate towards construction finance.
"The lower cost of interest to builders will further reduce the cost of apartment. I hope developers will pass on this benefit to consumers," Kumar said.
For consumers, SBI has launched an exclusive tailor made the scheme for affordable housing, 'SBI Hamara Ghar,' which will ease the process and enable a maximum number of consumers to avail home loan for these projects.
"This initiative will help millions of home buyers fulfil their dream of owning a home. In the long run, it will give a boost to the real estate industry and the economy as a whole, elevating the citizens from aspirants to actual home owners," Kumar said.
CREDAI President Jaxay Shah said: "Rebate on construction finance by SBI will be instrumental in facilitating a more affordable ecosystem which will lower the construction costs and enable the developers to pass on the benefits to the consumers."
SBI and CREDAI have also tied up with development of green real estate projects.
The bank will be providing an interest concession for the construction of green projects and also a processing fee waiver for home loans under SBI Green Home Loans.