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India's home loan market grew at nearly 30% in the last five years

India's home loan market grew at nearly 30% in the last five years


mortgage lending has increased from 1% of GDP in 1990 to 11% today: National Housing Bank

Experts from various industries, including regulatory organizations, banks, and embassies, convened for a webinar to discuss the role of technology and digital in the property valuation assessment and mortgage ecosystem. The webinar was organized by Valocity which offers a cloud-based technology platform that digitizes the workflow for lenders to connect and manage their Valuation panels.

According to Rahul Bhave, Executive Director of National Housing Bank, the property market in India has been growing by leaps and bounds. Mortgage lending has increased from 1% of GDP in 1990 to almost 11% of GDP now, with a total value of approximately Rs 27 lakh crore. According to the CAGR of over 30% over the last five years, the development potential is enormous. “The sector has performed admirably even throughout COVID. In comparison to the previous year, distribution increased by 185 percent in FY 2021. Banks provided over 65 percent of these loans, while HFCs provided the rest. In the housing sector, the entire game has changed, and technology is influencing the industry,” he remarked.

Amitabh Kant, Chief Executive Officer of NITI Aayog the innovation government Think Tank, chaired by the Honorable Prime Minister Narendra Modi, who was one of the esteemed panelists at the webinar said, “The need of the hour is to accelerate the digitization in India. In keeping with India's ambitions to become a knowledge-based economy, the transformation of mortgage lending and connecting the property ecosystem will expedite the speed of socio-economic change in the country.”

Mr. Kant in his keynote address, added, “The use of technology, and the data intelligence will enable the end-to-end system and enable transparency. The rich experience of the New Zealand-based Valocity Global company will add a lot of value to the market. Amidst the unique advantages offered by India, this is an incredible opportunity for everyone in the property and valuation ecosystem.”

Dr. M.S. Sahoo, Chairperson of Insolvency and Bankruptcy Board of India said, “I perceive that technology is making a notable difference in three spheres of mortgage lending, namely, automation of loan contracts, digitalization of records of ownership of property, and assistance in valuations.”

He further added, “India has a track record of establishing digital platforms and executing digital transactions through them. Twenty-five years ago, much before the advanced jurisdictions could think of, India ushered in the dematerialization of securities. The law and technology joined hands to automate the securities contracts completely - they standardized the securities and contracts thereon, dematerialized them, and enabled their execution online. This dawned the new phase of growth and efficiency of securities markets.”

Valocity, is digitally connecting valuers, brokers, and lenders across New Zealand, Australia, and Asia and has already supported over a Trillion dollars in lending decisions through it’s the platform. Now it is collaborating with lenders in India and has customized its valuation workflow platform-based solutions to enable the digital world of valuation and mortgage lending for India’s rapidly growing property sector.

Shanti Ekambaram, Group President – Consumer Banking at Kotak Mahindra Bank, said the government of India has been aggressively driving digitization, and the COVID-19 pandemic has leapfrogged Digital by 5 years. This means the financial ecosystem and players in it have to move quickly to digitise every aspect. “Mortgage is one of the core needs in India, and it is important to create an ecosystem of all players powered by technology. With Valocity’s mortgage valuation model, we will be able to digitize mortgage valuation which will bring efficiency in the whole process and enhance customer experience. I see a future where we will digitise everything in property transactions and digital mortgage valuation is a core part of it. This is just the beginning, but the journey is long.”

Carmen Vicelich, Founder and Global CEO of Valocity, said digital innovation is imperative in the evolving landscape. “Investing in real estate is for many an emotional activity as people are buying their home, and collaboration is critical to the sector's progress. Valocity delivers innovation for lenders by combining the best of technology, data, and human-centereddigitize design to totally transform the valuation loan for property experience. We make it possible for lenders to take advantage of cutting-edge technology, make data-driven decisions, and implement solutions swiftly and easily to deliver customer-centricity.”

“We aspire to continue to assist our clients in India by leveraging our deep investment in the best bank-grade security and end to end data capture to make the complicated simple,” she added. “Valocity is neither a bank, a valuation company, an aggregator, or a broker. We are a technology fintech that make it possible for the property valuation and financing ecosystems to communicate digitally, track workflow and securely share information increasing efficiency and improving client satisfaction.”

R V Verma, Non-Executive Chairman of Valocity, and esteemed ex-Chairman and Managing Director of National Housing Bank, said purchasing a property is a complex issue, particularly in India. It is complex, and there are plenty of gaps which we are trying to address through reform agenda. “Valocity is able to revolutionize the whole process by digitally connecting the lenders, valuers, brokers, and customers in several international jurisdictions. We have seen the evolution in the mortgage industry in many respects. The market infrastructure development, transparency, and standardization is a key aspect of the stability of the mortgage industry – which is increasing demand and consumer-driven.”

“Digitization will add a lot of value and enhance efficiency,” he continued. The mortgage business is on the verge of explosive growth. Now is the time to seize the opportunity to implement digitization. It'll be a win-win situation for everyone, and it'll be a fantastic opportunity to make the mortgage market more competitive.”


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