Punjab National bank’s PNB Housing Finance Ltd is now focusing on affordable housing finance, for which it has obtained RBI approval of $ 100 million External Commercial borrowings (ECB). Further, there is a plan to raise another $ 50 million, by way of loan from International Finance Corporation, for which there is a backing of a private equity fund – New Silk Route.
The fund will enable PNB to work on affordable housing segments in low income states, women borrowers and to finance mortgages for green residential units. Though PNB HFL was earlier dependent on the banks’ borrowings and NCDs for its funds, the new method of raising funds is part of the growth strategy for PNB HFL, experts at Ikia consulting services feel.
The low and middle income client would be benefitted with the housing finance offered as they would prefer investments in the lowest risk classes in the financial sector. One advantage that experts at Ikia consulting services foresee is the job creation on this front and integration of Tier 2 and tier 3 cities resulting in increased access to financial services, which results in growth of the economy.
Source : The Business Standard