International Finance Corporation, the private sector investment arm of World Bank, is planning to lend up to $75 million to the country’s top mortgage lender Housing Development Finance Corporation (HDFC). The loan would enable HDFC to provide affordable housing finance to underserved market of low to lower-middle income households in low income states in India, IFC said in a disclosure on Thursday.
HDFC is India’s largest provider of housing finance, primarily focusing on retail housing. Incorporated in 1977 as a specialised mortgage institution with the objective of encouraging home ownership by providing long-term finance to households, it has over time evolved into a financial conglomerate, diversifying into other businesses through its subsidiaries such as HDFC Standard Life Insurance (72.4 per cent), HDFC Asset Management Company (59.9 per cent), HDFC Bank (23 per cent), and HDFC General Insurance Company (73.9 per cent).
It counts among its shareholders the sovereign wealth funds of Singapore and Abu Dhabi.
IFC, which has been active in investing in India through debt, equity and quasi equity forms, has been particularly interested in backing financial services firms.
Last week, IFC said it would lend to two other financing companies in housing sector. It is looking to lend up to $70 million to Dewan Housing Finance Ltd (DHFL) and also disclosed plans to invest up to $50 million in Tata Housing Development Company’s affordable housing arm Smart Value Homes Ltd.
(Edited by Prem Udayabhanu)