Covid-19 to impact housing credit growth, dent HFCs: ICRA


New Delhi, Aug 20 | The Covid-19-induced slowdown is likely to pull down the growth of housing credit, thereby impacting housing finance companies (HFC).

As per an ICRA report, the pandemic effect is expected to lower the housing credit growth to 5-8 per cent in FY2021.

“The growth is expected to be slower in H1 FY2021 as disbursements were significantly low in Q1 FY2021 and started picking up from July 2020,” the report said.

“The overall recovery in H2 FY2021 depends on the economic turnaround as some borrowers may defer their home purchases till they are able to achieve stability in their income levels or in the resumption of business activities.”

According to the report, HFCs are likely to be differentiated on their ability to control fresh slippages amid slowdown in growth and steady easing of funding challenges.

“ICRA notes that the overall on-book housing loan portfolio growth of HFCs and non-banking financial companies (NBFCs) reduced significantly to three per cent Y-o-Y in FY2020 due to funding constraints for a major part of the fiscal,” the report said.

“Supported by portfolio buyouts, banks grew their housing portfolio at 11 per cent in FY2020. The ratings agency estimates the total housing credit at Rs 21.2 lakh crore as on March 31, 2020.”

Accordingly, the overall gross non-performing assets increased to 2.4 per cent as on March 31, 2020 with a sharp deterioration across the wholesale loan construction finance segment, given the tight liquidity situation faced by some developers with delayed projects and the reduced fund availability for the developers, the report said.

Source: IANS

Sponsors Posts

Global Strategist and Philanthropist Drummi Bhatt returns to her homeland to bring about a vernacular infotainment content revolution

Global Strategist and Philanthropist Drummi Bhatt returns to her homeland to bring about a vernacular infotainment content revolution

Drummi Bhatt has successfully donned many hats including that of a global strategy professional, mentor, and investor to early-stage startups encouraging women entrepreneurship, and a philanthropist.

Drummi currently leads Market Intelligence and Strategy team at Mitsubishi Power, USA building corporate-level strategies for global markets. Drummi is also the founder of KarmaKonnect, a Woman and Rural Empowerment Non-Profit Organisation which works for projects in remote rural, tribal, and conflict areas.

Her philanthropy work has taken her to various corners of India, including, far end corners of Leh, Ladakh, Telangana, and remote areas of Chambal. During these visits, she got mesmerized by culturally rich, vernacular, and diverse, the true “Bharat”.

During her interaction across the country, she got enchanted by the whirlwind of talent residing across Bharat, which is not restricted to a language, city, or just tier-1 cities but is found in abundance all across tier-2, tier-3 cities, and rural-tribal clusters.

With OTT platforms ruling the world in 2020, Drummi decided to bring her strategic insights and data analytics strength to this field by joining hands with seasoned entrepreneurs, Rahul Narvekar and Narendra Firodia, to launch its kind, vernacular OTT platform, Letsflix.

In 2019, Drummi, Rahul, and Narendra have successfully launched India’s first vernacular infotainment app, LetsUp, which now caters to 1.5 million users and in 7 vernacular languages, a feat achieved by none. The trio has now been passionately working towards creating and delivering vernacular content for every viewer in India with Letsflix.


Please enter your comment!
Please enter your name here