New Delhi, India, November 6, 2013—IFC,
a member of the World Bank Group, will provide a $85 million loan to Dewan
Housing Finance to expand finance for affordable and energy-efficient housing
in India. The loan is being given with the support of the Government of
Of the total loan, IFC will provide
$70 million through external commercial borrowing. IFC has committed an
additional $15 million to finance green mortgages under the IFC-Canada
Climate Change Program, made possible thanks to the Government of Canada's
instrumental contribution, which made the financing package viable. IFC
is the implementing agency for the program. The loan to Dewan, to be used
for green mortgages, will reduce 6,200 tons of carbon emissions per year.
“While housing finance is one of the
lowest risk asset classes in India, financial institutions have so far
shown limited interest in the low income segment,” said Kapil Wadhawan,
Chairman and Managing Director, Dewan Housing Finance. “IFC’s investment
will demonstrate the viability of offering housing finance to low and middle
income clients. IFC's support to Dewan is a recognition of the company's
track record in serving this segment."
The housing finance market in India
has a huge gap to fill. According to India’s Twelfth Five Year Plan (2012-2017),
the housing shortage in the country is estimated at 58.8 million units.
Over 90 percent of this demand is from low-income households, especially
the under-served segments.
“Promoting housing finance is one of
the key priority areas for IFC in India, especially in India's low income
states,” said Serge Devieux, IFC Director for South Asia. “By demonstrating
the benefit of green homes, the project is expected to help home buyers
in low and middle income segments buy affordable energy-efficient homes.”
IFC has a long-term partnership with
Dewan Housing over the last decade. In 2003, IFC provided a loan of around
$12.5 million to the company. IFC also co-invested in Aadhar Housing Finance,
a company jointly promoted by DHFL Group and IFC, which provides affordable
home loans to low income borrowers.
About the IFC-Canada Climate Change
The IFC-Canada Climate Change Program promotes private sector financing
for clean energy projects. Canada’s financing to IFC for this program
is part of its overall fast-start financing contribution for 2010–2011.
Under the Copenhagen Accord, developed countries committed to provide fast-start
financing of almost $30 billion for 2010–2012 to support climate change
mitigation and adaptation in developing countries. As part of Canada’s
commitment to support climate change action in developing countries, Canada
is contributing $1.2 billion Canadian dollars in new and additional climate
change financing over three years (fiscals 2010–2013).
IFC, a member of the World Bank Group,
is the largest global development institution focused exclusively on the
private sector. Working with private enterprises in more than 100 countries,
we use our capital, expertise, and influence to help eliminate extreme
poverty and promote shared prosperity. In FY13, our investments climbed
to an all-time high of nearly $25 billion, leveraging the power of the
private sector to create jobs and tackle the world’s most pressing development
challenges. For more information, visit www.ifc.org