Fresh loan disbursements by NBFCs reach pre-Covid levels: Report
Fresh loan disbursements in housing segment likely to grow in the long run
After a lukewarm performance in the second quarter of the current financial year, beset by the restrictions imposed due to the second wave of Covid-19, the Non-Banking Financial Companies (NBFCs) reached pre-Covid levels in fresh loan disbursement. The NBFCs reported the growth in fresh loan disbursements after a slow progression in April-June quarter, the Times of India reported.
In August announcing its first quarter result for this financial year, HDFC said that the July disbursements were highest ever in a non-quarter end month and stated that growth in home loans came from affordable housing segment and high-end properties.
According to its Managing Director Renu Sud Karnad, India’s largest private lender sees an upside for the housing sector not just in the short term but also in the medium to long term, the TOI report added.
The TOI report quoted Y Viswanatha Gowd, MD and CEO of LIC Housing Finance, as saying, “The pandemic had reinvigorated the importance of home ownership. The concept of work-from-home is also fueling the need and creating a demand for larger spaces as a subset. We are expecting a positive rub off in the realty space in the coming quarters with the overall economic sentiments improving further.”
Time for expansion
According to the report, Shriram Housing Finance disbursed higher fresh home loans, of around Rs 650-700 crore in the July-September, compared to loans of Rs 220 crore that it disbursed in the April-June quarter. Its MD and CEO, Ravi Subramanian was quoted as saying that his company has already reached pre-Covid levels of loan disbursements and going forward it is focusing on expanding business in tier II and tier III cities.
Last month, M&M Finance recorded 57% YoY growth in disbursement of loans to the tune of Rs 2150 crore. Similarly, according to Indiabulls Housing Finance, since July fresh loan disbursements have picked up and last month it disbursed Rs 550 crore in retail loans. By the end of this month Indiabulls Housing Finance is expected to disburse nearly Rs 750 crore under this category.