ADB, AHFL Sign $60 Million Deal to Expand Women’s Access to Housing Loans in India

NEW DELHI, INDIA (25 June 2024) — The Asian Development Bank (ADB) has signed a $60 million (in Indian rupee equivalent) nonconvertible debentures financing agreement, $30 million of which has been disbursed as of today, to help Aadhar Housing Finance Limited (AHFL) provide housing loans to women and address the shortage of financing in the low-income and affordable housing segment in India.

The financing will be used by AHFL to exclusively lend to women borrowers or coborrowers. At least half will be deployed in the states of Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Odisha, Rajasthan, Uttar Pradesh, and West Bengal.

“Poor households are often unable to meet bank loan requirements and often finance their homes through savings, or by borrowing from family or friends or from moneylenders at high interest rates. Women, in particular, find it harder to access financing from formal channels,” said ADB Director General for Private Sector Operations Suzanne Gaboury. “Companies such as AHFL serve these communities through products tailored to their needs and circumstances. ADB’s support will expand AHFL’s capacity to reach more underserved families seeking to own a home.”

India’s housing shortage is estimated at 26.3 million homes in urban areas and nearly double that number in rural areas. There is limited availability of mortgage lending for people with informal employment and in lower-income groups.  

“AHFL aims to increase the financial penetration by focusing on growing our share of the low-income housing segment mortgage market in India and continuing to focus on the salaried and self-employed categories from the economically weaker and low- to middle-income segment of the Indian economy,” said AHFL Chief Executive Officer Rishi Anand. “The tie-up with ADB is a step further in creating a stronger network of self-owned, low-income houses, helping to fulfil the aspirations of the economically weaker sections of society.”

AHFL is a housing finance company in India focused on the low-income housing segment,  with ticket size less than 1.5 million Indian rupees (around $17,976). The company targets lower-income borrowers. AHFL offers loan with average ticket size of 900,000 Indian rupees (around $10,875) through its network of 471 branches across 20 states and union territories in India as of September 2023.  

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.