Owning a home is one of the key metrics that helps a person to do upward mobility and get a space in society. In a country like India, the basic necessity of having a home to stay in is still not readily available due to the large section of people who fall in the low-income category.
However, with the right financing tool, one can cater to this market as they are quite a sticky customer, and chances are they fall under the retail book of the bank or NBFC, which reduces the chances of default.
There are DSA partners who can help the customers get home finance, which will be of low interest and affordable for the targeted customers. Banks can also afford to provide those loans as they can distribute the risk with multiple borrowers since the ticket size of the loans is small, and therefore the risk of defaults gets reduced.
The Need for Affordable Home Loans in India
In India, we have very little home ownership and it’s a fundamental part of a person’s life as they desire to have their home. A home provides a sense of security to a person and thus makes homeownership a popular choice of investment.
In a country like India, there is a large segment of people who are migrating to urban spaces, and therefore, the need for affordable housing loans is building up. As the country progresses, more people will need homes to stay, and therefore the need for loans will surge in the current times.
Benefits of Home Loans For Customers
The benefit of a home loan is that it allows a person to have a better aspect of life as it’s considered as a way for a person to show their upward mobility. For example, a person with a home will not worry anymore about the place to stay, rent, and other aspects that can cause stress. Now, with home loans, a customer can have the following benefits, which are best for their financial welfare.
- Involving Different Groups in Financial Inclusion
Different groups of people have different financial situations. For them, they must be a part of the banking system so that they can also become a part of the modern financial facilities.
A home loan allows a person to build a credit score, which helps them to get other financial products that are helpful for their livelihood or a better opportunity to make something different in life.
- The Need for Upholding the Middle-Income Group
The middle-income earners are the backbone of the economy as they are the ones who drive up consumption in the country. An affordable loan is an easy way for the middle-income group to get a good property with the help of monthly payments, which eases the burden of the loan. A person who wants to find a good home loan option can connect with an agent from an app for DSA, where one can get guidance about the particular loan offers.
- Helps to Fastrack the Economic Growth
India is a growing economy, and for that, it needs credit facilities for the citizens who are at the forefront of economic growth as they drive the consumption value of the business. It also increases the chances of employment as it allows the real estate developers to build more homes, which brings growth in the other parts of the economy, overall increasing the consumption of the economy.
- A Push for Promoting Socio-Economic Development
A home loan is also a growth vehicle for an individual as it helps them to uplift the socio-economic standard. For example, a person who is buying a home signifies a sense of security in the community, and therefore it increases the chances of development in other areas.
For example, a person buying a home will shell some extra money on furniture and paint, which will again boost the growth in the auxiliary industries such as the paints and furniture market. Hence, it’s a development and a win-win situation for the home buyer and other parallel sectors linked with home ownership.
Homeownership can solve several other challenges in this country, starting with the increase in the homeownership rate. It will show that the country’s population is moving upward in society and will also address the home shortages. Thus, affordable housing loans have the power to create a domino effect in the housing market.
