29-Oct-2011
Kerala-based Muthoot FinCorp, the flagship company of the Muthoot Pappachan Group, announced its foray into the housing finance segment after securing a licence from National Housing Bank on Tuesday.
“This is in line with our long-term expansion strategy. We see immense scope in the home loan market, especially in the low income segment. The idea is to be a facilitator to every Indian dream of owning a house,” Elaborating on the subject, Muthoot Pappachan Group executive director Thomas Muthoot said.
The new venture, Muthoot Housing Finance Limited will be a subsidiary of the flagship company Muthoot FinCorp Limited.
The group plans to invest around ₹ 100 crore over the next two years in this venture, which would primarily target the low to middle income housing finance segment and aim to disburse small-ticket loans.
“We want to tap the opportunity in the middle and low income segment, which is yet to be explored fully. We are looking at customers in the segment with a monthly income of ₹ 10,000-30,000 and an average loan size of ₹ 3-10 lakh,” Muthoot Housing Finance CEO Maneesh Srivastava said.
The company is targeting ₹ 125 crore loan size by December 2012, he said adding that the interest rates will be competitive at about 14-15 per cent. The funding will be done through various sources, including banks, he added.
In the initial phase, the group plans to roll-out 25 branch offices in large urban centres like Chennai, Bengaluru, Ahmedabad and with its headquarters in Mumbai.
“Initially, we are starting from the west and the south. However, we will have pan-India presence in another 18 months,” Srivastava said.
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