Home loan market set to pick up: Square Capital

Digital lending platform Square Capital, part of real estate market Square Yards, is optimistic that credit momentum will return in the coming days and expects the real estate loan market to pick up – that’s because a number of NBFCs have raised external capital. Therefore, they expect things to return to normal within the next 15-20 days.

Square Capital is one of the leading online distributors of mortgages or secured loans. It has links with major private sector banks and NBFCs to provide secured home loans and property loans.

Talk to
Activity area , Tanuj Shori, founder of Square Capital, said: “The market is currently struggling with problems related to the shortage of liquidity, but financial institutions are conservative. However, in the next 15-20 days we will see market momentum return and there will be an increase in demand for credit, especially home loans.

Shori added that India is a very under-penetrated market when it comes to mortgage lending as there are no dedicated fintech players looking to serve the mortgage lending segment. Also, the number of new homes coming each month is very insignificant.

“In India’s top 10 cities, only 25,000 new homes are being built every month, compared to one million homes a month in China. There is huge room for growth in this market and we are bullish longer term,” Shori said, adding that the company, which started in 2016, has a disbursement rate of ₹200 crore per month. It performs around 800 loan transactions on a monthly basis.

The company is looking to end the 2019 financial year with a total disbursement of ₹2,300 crore and by 2020, it is looking to disburse ₹4,000 crore.

Priscilla C. Carnegie