LIC HF plans to offer 'affordable credit' to customers

Property loans could soon get cheaper at LIC Housing Finance. The company is looking at a number of measures in order to offer 'affordable credit' to customers, report Appaji Reddem and Sandeep Srikanth of CNBC-TV18.

LIC HF, the country's third largest housing finance company after SBI and HDFC, is trying to leverage on all options possible to take on competition.
LIC Housing Finance aims to disburse Rs 25,000 crore worth housing loans this year, up more than Rs 20,000 crore compared to last year.
But in order to move ahead in the game, here's what it plans, it wants to offer 'affordable credit' to draw in customers and the idea is to bring down the interest rate level from the current 10.25%.
VK Sharma, CEO, LIC Housing Finance, says that market expects that there will be a differential of 1-2%. If it remains in that, it's good because that can be passed on to the customers."
So how does LIC HF plan to achieve this?
On one hand the company is mulling to raise Rs 700-1,000 crore through external commercial borrowings and at present, a high level committee at LIC HF is closely working with the RBI, and also weighing options to take advantage of the expected funds from ECBs
"We expect that within that segment for which RBI is permitting, we expect that we'll be somewhere around Rs 700-1000 crore. So we'll apply for that,” says Sharma.
Not just that, LIC HF will also be completing its proposed Qualified Institutional Placement (QIP) to raise up to Rs 1,200 crore before the end of this fiscal. And of course, the company is banking on the expected RBI rate cut this month which could further help it to revise interest rates.