Shriram Housing Finance partners State Bank of India for Co-lending to Affordable Housing 

Shriram Housing Finance

Shriram Housing Finance Ltd, a leading affordable housing finance company today announced the signing of a co-lending agreement with State Bank of India(SBI), India’s largest bank, for priority sector affordable home loans. The two entities will jointly service housing loan customers as per the 20:80 co-lending model (CLM) of the Reserve Bank of India (RBI).

Part of the Shriram Group, Shriram Housing Finance is amongst the largest affordable housing financier in India andone of the fastest-growing companies in the segment. The company will target priority sector housing loans in the affordable housing segment under this co-lending arrangement with SBI. Shriram Housing Finance will originate, process and service the loans.

Commenting on the partnership Ravi Subramanian, MD & CEO of Shriram Housing Finance said “The demand for housing is immense in the affordable segment and we have barely scratched the surface. We are extremely excited to partner with SBI and together we would be able to serve a much larger customer base, especially borrowers at the bottom of the pyramid. Through the co-lending model, we intend to leverage the balance sheet strength of SBI and our underwriting capabilities.”

He added “Shriram Housing Finance specializes in affordable housing finance, specifically in the self-employed segment which we call the ‘Emerging Middle Class’. Priority sector lending accounts for around 40% of our loan portfolio. There are key markets where we have a very deep consumer understanding and high underwriting prowess. The partnership with SBI will augment our strengths and provide adequate support as we work towards our objectives of serving the ‘AamAadmi’ and financial inclusion.”

Since its inception, SHFL has provided affordable home loans to over 1 lakh customers, including households that belong to the lower end of the income spectrum, especially with informal sources of employment and income. The company also plans to leverage the extensive network and infrastructure of the Shriram Group to grow its presence in the emerging middle-class segment, and reach the last mile customer.

Dinesh Kumar Khara, SBI Chairman said, “We are glad to have joined hands with Shriram Housing Finance under the co-lending program. This collaboration will enhance our distribution network, as we aim to extend our credit reach to more Home Loan borrowers of the unserved and underserved segments. Such partnerships align with our commitment to accelerate effective and affordable credit to small home buyers in India and contribute to the vision of “Housing for All by 2024”.

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