Oikocredit & Insitor Provided Seed Capital To Aashiyaan Housing & Development Finance
Dutch social investor Oikocredit and Asia-focused venture capital firm Insitor have provided seed capital to Aashiyaan Housing & Development Finance, promoted by former Arohan Financial Services chief executive.
Aashiyaan, which has sought National Housing Bank’s permission to do business in affordable housing segment, has also received funding from individual investors such as journalist Swaminathan Aiyar and Columbia University professor Neeraj Kaushal.
The firm raised about Rs 13.5 crore, including Rs 5 crore each from Oikocredit and Insitor. Bengaluru-based Unitus Capital advised it in fundraising. Aashiyaan looks to provide loans to build affordable houses to low-income individuals in semi-urban and rural areas in the eastern market.
While penetration of affordable housing finance received a boost from the government stimulus, growth has primarily been seen in the southern and western parts of India. The eastern region remains highly under-penetrated, said chief executive, who resigned from his microfinance venture Arohan in December 2015. He founded Arohan in 2006 which became part of the Intellecap Group in September 2012.
Indian housing finance market, estimated at Rs 11.9 lakh crore, is growing at 18% per annum. It still remains significantly underpenetrated with one of the lowest mortgage penetrations globally.
The total housing shortage in India is 6 crore units which translate into affordable housing finance potential of Rs 21.5 lakh crore. The government has extended support to the sector through affordable housing fund, lower Goods & Services Tax rates, Credit Linked Subsidy Scheme (CLSS) of Pradhan Mantri Awas Yojana (PMAY) with favourable terms.
This segment has seen traction in the past couple of years with new players showing interest. Inditrade Capital, a non-bank lender, is also keen to get a licence from NHB and plans to start a business with Rs 11 crore capital.
Under ‘Housing for All by 2022’ initiative, the government launched Pradhan Mantri Awas Yojana Urban in 2015 and renamed the erstwhile Indira Awas Yojana as Pradhan Mantri Awas Yojana Grameen. Under both these schemes, a total of 5 crore houses were planned to be constructed by the financial year 2022. The government’s budgetary support for these schemes has risen to Rs 29,043 crores in FY18 from Rs 11,600 crore in FY16.
Source Link- https://economictimes.indiatimes.com/