India's largest lender SBI and India Mortgage Guarantee Corporation (IMGC) today signed a pact to offer mortgage guarantee scheme for prospective non-salaried and self-employed home loan customers.
The offering will help increase home loan eligibility up to 15 per cent within the regulatory norms, the State Bank of India (SBI) said in a statement.
"With the rising demand in affordable housing segment, this product aims to provide home finance to select target audience at better terms," it said, adding that SBI would be the bank to provide mortgage backed home loan product to non-salaried class.
"MoU (Memorandum of Understanding) between SBI and IMGC is a strategic initiative which will enable us to improve housing loan volumes in non-salaried segment.
Under this product applicant can avail higher finance based on risk grade of the borrower, by opting for IMGC default guarantee cover," said P K Gupta, MD (Retail & Digital Banking), SBI.
SBI further said the MoU with IMGC will pave the way for the bank to introduce many more products in the mortgage guarantee backed home loan segment to fulfil the needs of Indians of buying their dream homes.
"The exclusive arrangement with SBI is aligned to our joint goal of responsibly expanding the housing finance market in India, through innovative product offerings," Mahesh Misra, CEO, IMGC.
IMGC is a joint venture between National Housing Bank, Genworth Inc International Finance Corporation and Asian Development Bank. It is providing mortgage default guarantee to the lending Institutions in India.
As on December 31, 2017, SBI had a deposit base of Rs 26.51 lakh crore. It has 32.16 per cent market share in home loans and 35.54 per cent market share in auto loan.
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