GE-Wizard JV to offer home loans at 9.99%

Consumer financial services provider GE Money and international mortgage player Wizard today announced a joint venture 'Wizard Home Loans' that will offer 9.99% floating interest rate on home loans.

"The joint venture will invest $200 million in equity in India and aims to set up over 250 branches across the country by 2011," T P Chopra, CEO, GE India said here.

It will offer an aggressive interest rate of 9.99% to consumers, he said.

The prevailing market rate for home loans is between 11% to 12% for varying tenures. The domestic home loans segment has been growing at a compounded annual growth rate of 30% since 2001. According to National Housing Bank, India faces a shortage of 30 million housing units.

Wizard chairman Mark Bouris said the company hopes to attain two billion dollars asset base of home loans by 2011.

Bouris said consumers would be offered home loans through franchisees, who would be paid an upfront fee and a monthly commission as long as the loan remains on the company books.

Wizard India CEO Egisto Franceschi said cost of funds would be relatively lower as the company would get funds from its GE relationship. The company plans to be among the top five players in the Indian home loan market in the next 5-10 years, he said.

In addition, Wizard will provide loans against property to enable consumers meet needs such as business expansion or any other financial needs, he added.