Bank of India, a public sector bank, and Indian Mortgage Guarantee Corporation (IMGC) have joined hands to offer mortgage guarantee-backed home loan products in the affordable housing sector. This partnership aims to provide support to both salaried and self-employed individuals seeking home loans.
According to a statement by the company, IMGC's guarantee will help mitigate the risk of defaults for Bank of India, which could lead to the bank offering more favorable loan terms to borrowers. Mahesh Misra, the managing director and chief executive officer of IMGC, highlighted that these products would promote financial inclusion and facilitate early home ownership.
This collaboration leverages IMGC's guarantee expertise and Bank of India's extensive network of over 5,100 branches across India. The goal is to provide home loan products with enhanced flexibility and security to potential homeowners.
IMGC has achieved significant milestones, surpassing Rs 25,000 crore in home loan guarantees for over one lakh customers across 400 locations nationwide. The corporation has partnered with more than 23 lending institutions, including banks and housing finance companies (HFCs), to provide mortgage cover.
The mortgage guarantee serves as a shock absorber for banks, enabling them to increase their lending in the affordable housing finance segment, despite the high default risks associated with it.
IMGC commenced its operations in March 2014, initially underwriting a securitization pool originated by Dewan Housing Finance Limited, as reported by ICRA.
