Categories: Banking

HDFC borrows USD 400 million from IFC for financing green affordable housing

HDFC borrows USD 400 million from IFC: As part of their efforts to promote climate goals, the International Finance Corporation (IFC) has provided a loan to mortgage giant HDFC in the amount of USD 400 million for the financing of green, affordable housing units.

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HDFC borrows USD 400 million from IFC: Key Points

In separate statements released, HDFC and IFC claimed that the loan would increase green housing, help close the urban housing gap, increase access to affordable climate-smart homes, and support the country’s transition to a more sustainable growth path while also generating jobs and ensuring long-term business growth.
According to HDFC, it has set aside 75%, or USD 300 million, of the IFC cash for financing environmentally friendly affordable housing developments.
According to HDFC estimates, 275 million people, or 22% of the nation’s population of nearly 1.4 billion, lack access to appropriate housing,
Rural areas experience a housing crisis twice as severe as urban areas, according to HDFC.
Urban housing was in under supply by 29 million units as of 2018, up more than 54% from 2012, according to HDFC.

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HDFC for financing green affordable housing

This timely investment will increase economic resilience and promote the government’s goal of housing for all by energising HDFC’s efforts to serve the underserved parts of the population.
A little over 24% of the nation’s electricity is used for residential housing.
In accordance with the climate commitments made under the Paris Agreement and at the COP-27 climate change conference in Sharm el-Sheikh, the green affordable housing sector is essential for lowering greenhouse gas emissions through, among other things, greener construction practises and lower household energy consumption.
IFC’s loan to HDFC demonstrates the viability of lending to underserved communities, according to Hector Gomez Ang, regional director for South Asia at IFC.
There is a growing need for affordable housing and a market that is mostly untapped.

Since 2010, IFC has given domestic housing finance companies about USD 1.7 billion in loans for on-lending to retail buyers as well as to builders of affordable and environmentally friendly dwellings.

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