New Delhi, India, October 27, 2010—IFC,
a member of the World Bank Group, India’s National Housing Bank, and the
Rajasthan state government are coming together in a unique public-private
partnership to establish a new housing finance company in the state of
Rajasthan that will provide home loans to low-income households.
IFC’s own stake and mobilization through
stakeholders such as National Housing Bank, government of Rajasthan, and
private sector players, will help establish the company with an initial
capital of $22 million. The exact shareholding structure is currently under
discussion. The new company will focus on providing affordable housing
finance options to low- and middle-income households that have limited
or no access to formal financial services.
More than 14 percent of South Asians
have no home or live in inadequate housing such as urban slums and squatter
settlements, according to World Bank estimates. While the region’s
housing and housing finance markets are dynamic, they are limited in their
outreach, catering primarily to upper-income groups.
"Involvement of multiple stakeholders
and the ability to build successful public-private partnerships is crucial
to developing an ecosystem that will improve accessibility of housing finance
and affordable housing. We will support the company through equity, training,
and refinancing,” said R. V. Verma, Chairman and Managing Director, National
Of the total shortage of about 25 million
affordable housing units in India, 98 percent constitutes demand from economically
stressed and low-income households. The government’s National Urban Housing
and Habitat Policy recognizes that public sector resources alone cannot
meet this high demand.
IFC Regional Director for South Asia,
Tom Davenport, said, “There is a huge unmet need for housing finance in
India. Addressing this need is a strategic priority for IFC. Access to
housing and affordable home financing plays a critical role in creating
jobs, enhancing incomes for the less privileged, strengthening financial
markets, and triggering sustainable and inclusive growth.”
G. S. Sandhu, Principal Secretary, Urban
Development and Housing, Rajasthan state government, said, “By partnering
in instituting this new company, we now have an example of a first-of-its-kind
model to harness market opportunities while making affordable housing loans
To learn more about IFC’s activities
in South Asia, visit www.ifc.org/southasia.
IFC, a member of the World Bank Group is the largest global development
institution focused on the private sector in developing countries. We create
opportunity for people to escape poverty and improve their lives. We do
so by providing financing to help businesses employ more people and supply
essential services, by mobilizing capital from others, and by delivering
advisory services to ensure sustainable development. In a time of global
economic uncertainty, our new investments climbed to a record $18 billion
in fiscal 2010. For more information, visit www.ifc.org.