Mumbai : Union Bank of India (UBI) & Home First Finance Company India Ltd (HomeFirst) have entered into a strategic co-lending partnership to offer home loans to customers at competitive interest rates. The partnership aims at leveraging the strengths of both entities to provide a seamless experience to retail home loan customers in the priority sector.
This partnership will enable HomeFirst to expand its product offerings to customers in the geographies it operates, while continuing to leverage its technology led customer-first approach. UBI (established in 1919) is one of the oldest and largest public sector banks in India with total deposits base of over Rs 9.14 Lakh Crores and advances book (AUM) of Rs 6.35 Lakh Crores as on Sept’21.
Under this partnership, HomeFirst will originate loans as per the agreed credit policy of UBI in line with the provisions of RBI’s Co-Lending Model. HomeFirst will retain minimum 20% of the loan on its book while 80% will be on UBI’s book. HomeFirst will act as a servicing agent for the loan accounts sourced under this partnership throughout the life cycle of the loan. The partnership is an outcome of the co-lending framework laid down by Reserve Bank of India (RBI) which provides a collaboration model to benefit from the low-cost funding model of a bank and the cost-efficient sourcing and servicing capabilities of a non-bank.
“We are pleased to partner with Union Bank of India. We can now leverage Union Bank of India’s deposit-led franchise and complement that with our strong technology-led distribution to provide efficient home loan solutions to a wider gamut of customers. This partnership is one more step in our mission ‘to be the fastest provider of home finance for the aspiring middle class, with ease and transparency’ Mr. Manoj Viswanathan, MD & CEO said.