Central bank of India has entered into an agreement with Star Union Dai-ichi Life Insurance to launch a scheme that assures life-time annuity for senior citizens opting for a reverse mortgage loan from the bank.
“The product, named “CENT Swabhiman Plus”, is an improvement to the existing product CENT Swabhiman,” said Mr S. Sridhar, Chairman and Managing Director, Central Bank of India, at the launch function in New Delhi. One of the improvements in the new scheme is that a senior citizen can avail himself of lifetime payment as against the maximum of 20 years in the existing reverse mortgage loans offered by various commercial banks.
Speaking to a leading business magazine, Mr M. Balachandran, Chairman of Star Union Dai-chi Life Insurance said that since a life insurer been roped into the product, the bank will be able to offer higher monthly payments to senior citizens. The life insurance company will be in a better position to assess life risk and provide better terms through annuities, he said.
Mr G.C. Chaturvedi, Additional Secretary in the Finance Ministry, mentioned that reverse mortgage loan products had not clicked in India after their launch in 2007 and expressed hope that efforts would be made by Central Bank to increase awareness about the new offering.