• What does Micro Housing loan means?

    Micro housing loan is meant for the Economically weaker section or Low income group, where the borrowers may largely be in engaged in informal segment and financially excluded.The loans are provided towards purchase or construction / renovation of houses. The payment tenure and terms are largely similar to any traditional home loans but at affordable cost.

  • How is Svatantra Micro Housing Finance Corporation (SMHFC) different from other housing loan companies?

    SMHFC solely focuses on granting loans for housing requirement of the financially excluded population in economically weaker and Low income group segment. Svatantra Housing emphasis on customer centricity and innovation as the centre of business philosophy. With customer centric approach, the company has a unique branchless business model wherein loans formalities and delivery happens at borrowers home. SMHFC employees visit the prospective customer's workplace to understand the need, income, business details of the customer along-with liabilities if any. The company leverages technology to ensure efficient process at low cost and maximum transparency.

  • What is financial inclusion?

    As defined by RBI (Reserve bank of India) Financial Inclusion is the process of ensuring access to appropriate financial products and services needed by vulnerable groups such as weaker sections and low income groups at an affordable cost in a fair and transparent manner by mainstream Institutional players.

  • Who are micro housing loan clients?

    Micro housing loan clients belong to Low Income Group (LIG) and Economically weaker section (EWS) with limited access to financial services from formal financial institutions such as banks. They may reside in either rural or urban areas but due to lack of proper documents or insufficient collateral security, are unable to utilize banking facilities. The customers are a mix of self-employed micro-entrepreneurs (e.g. vegetable vendors, electricians) and unorganized sector salaried workers (e.g. drivers, housemaids), who either live in rental housing or temporary/ illegal tenements and earning a combined household average income of between Rs.8,000 and Rs.25,000 per month. In rural area our clients may also include covers landless laborers and small and marginalized farmers. The loan can be utilized for either purchasing a property or to construct/repair/renovation/extension on an existing house.

  • How does micro housing loan benefit the financially excluded population?

    It is a dream of many to buy new house and in rural areas many seek to repair/ renovate their houses. But not many have the financial means to achieve this dream and lack of formal financial solution make this accessibility more difficult. Micro housing loan is a differentiated offering unlike mainstream home loan product. Micro housing loans help the prospective customers meet their housing aspiration, even with a low level of income and in absence of formal documentation.

  • What is the rate of interest charged on the loan?

    Svatantra Micro Housing Finance Corporation grants loan up-to 85 % of the cost of the flat upto Rs.15 lakhs. It lends at an average interest rate of 11% -13% p.a. (reducing balance) for Affordable housing purchase (AHP) and 16% for beneficiary led construction (BLC).

  • Are Microhousing institutions regulated?

    Microfinance Housing companies in India are regulated by the National Housing Bank (NHB- Wholly owned by RBI) through its master circulars pertaining to housing loan industry COR No: 02.0071.09

  • What Customer Protection measures exist for clients?

    The company has laid down a Customer protection and grievance redressal policy. The overall objective is to protect the customer from concerns emanating out of impact of excessive interest rates, improper/ non-transparent lending practices, coercive collection practices and over-indebtedness among EWS/ LIG borrowers. We emphasizes on responsible lending practices . The three main aspects of these are as follows:

    • Customer Protection, Regulation and Supervision to ensure customers are treated fairly and appropriately and that they understand the implications of their actions
    • Improve standards and codes of conduct with an emphasis on consistency
    • Financial Literacy training to make clients more informed so that they can become more responsible for their own financial welfare.