Ghar ka SapnAA Poora: Affordable Housing for All
his SamvAAd Show-and-Tell Session demonstrates a co-lending use case for AAs for affordable housing loan origination and monitoring. This demo was a collaboration between Homeville Group, Finvu AA, and Finarkein Analytics.
Introduction
Bharat Housing Network Platform is a co-lending platform from Homeville for affordable housing, with more than 15 housing finance companies (HFCs) originating loans. Their operations are spread across 25 states, with access to more than 200 home loan branches nationwide. They have categorized affordable housing customers in the following way:
| Segment | Characteristics |
| Economically Weaker Group (EWG) | annual household income less than three lakhs |
| Low Income Group (LIG) | annual household income more than three lakhs up to six lakhs |
| Middle Income Group (MIG) | annual household income more than six lakhs up to 18 lakhs |
Who are the customers?
The affordable housing customers fall into a 60:40 ratio between self-employed and salaried. Within this, a 50:50 ratio exists between professional self-employed and non-professional self-employed. About 35-50% of these customers are new-to-credit (NTC), making underwriting difficult. Although the net banking penetration is low, around 65-70% of these consumers actively transact via UPI. The affordable housing ticket size typically falls between 17 lakhs to 35 lakhs. This use case specifically caters to loan requirements ranging from 17 lakhs to 25 lakhs for a repayment duration of 15 years.
Leveraging India Stack
The use case has actively integrated most India Stack capabilities onto their platform. This has enabled them to offer an end-to-end digital housing loan solution. The presenters expressed the opinion that DPIs (Digital Public Infrastructures) are a once-in-a-generation opportunity to improve how wealth is created in India. Take a look at the list below:
- Presence-less layer: Customer onboarding through DigiLocker and e-Aadhaar.
- Paperless layer: AA integration for one-point access to multiple financial data points for improved credit assessment.
- Cashless layer: UPI collection and BBPS integration, as well as Aadhaar-based mandate registration along with eNACH capabilities
- Consent layer: financial data sharing using AAs consent management framework; Aadhaar and NSDL-based e-signing for agreements.
What do AAs offer?
The Account Aggregator (AA) framework functionality goes beyond mere onboarding; it allows continuous monitoring throughout the loan term. Leveraging an AA optimizes monitoring efficiency, ensuring the most advantageous outcomes. Tracking and analyzing data consistently enhances decision-making processes and offers the best value for lenders and borrowers throughout their transaction journey. This comprehensive approach boosts transparency and fosters a seamless and secure borrowing experience.
| Challenges | Solutions | |
| Analysis | Lack of banking and financial documents → pendency Inaccurate and unparsable OCR data → FTNR |
Acquire data from the source, increasing the derived analysis and incorporating innovative methodologies. |
| Underwriting | Risk of forgery AND Incomplete income and asset allocations → appraised income dependency | One-point access to multiple FIPs → deriving maximum information. Build the ability to derive true eligibility based on all assets, which may be higher than primary eligibility |
| Monitoring | Lack of tools to predict collection patterns & respond accordingly | Continuous flow of information improves collection efforts by allowing regular monitoring and validation of banking and income |
Catch the recorded live demonstration and the complete session here:
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