India's small towns adding to home loan growth by 19%

New Delhi: Home loan segment is one area where both the public and private sector bank are currently focussing a lot.

As per a report in the Times of India, small towns are the main engine behind the growth in home loan.

Host of freebies, offers and discounts are thrown by developers and promoters who also promise a quick sanction of loan with the banks they have tied up.

With increasing ambition to own a house, two tier cities and small towns, however, have changed the dynamics in loan business.

The focus has shifted to smaller banks. The paper said, Syndicate Bank's home loan portfolio has expanded 76 percent, Central Bank, Andhra Bank to 30 percent, ICICI Bank at 28 percent, HDFC at 23 percent. While largest public sector lender SBI was at 15 percent.

Bank credit growth continued to disappoint during first half of the current fiscal with an annual growth of just 8.4 percent at Rs 62.02 trillion (Rs 62.02 lakh crore), down 20 bps, as per Care Ratings.

However home loans were up 8.6 percent against 7.5 percent at Rs 6.83 trillion.

News source: The Hindu