Real estate firms paying up to 15% interest rate on loans amid slowdown

"Construction finance has become difficult even for good companies. Even public sector banks are charging at 13.5 per cent," said Mayur Shah, managing director of Marathon Realty.

Real estate developers, who are battling a prolonged slowdown in sales, are struggling to raise funds to construct properties, several developers told Business Standard. Even those who are getting funds seem to be paying through the nose.

Going through a liquidity crunch following the Infrastructure Leasing and Financial Services (IL&FS) crisis in 2018, it’s become difficult for developers to raise construction finance, which was once considered safest form of lending by banks and non-banking financial companies (NBFCs).
 

Those who are getting construction finance are paying interest rates of between 13.5 per cent and 14.5 per cent. It was 10-12 per