A recent press report said that dual rate home loans are once again capturing a space in the loan portfolio of some of the big lenders in the country. Lenders like ICICI Bank and HDFC as well as LIC housing finance have already introduced these fixed cum floating rate schemes in the home loan segment for customers.
Reports said that with the RBI’s direction for banks to set higher provisioning requirements in case of teaser loans, many other lenders are still doubtful in following the trend and opting for teaser loan schemes of their own.
Mr. Anil Kothuri, Executive Vice President of Edelweiss Housing Finance (EHFL) has said that it is unlikely that other financial institutions will come up with dual housing loan rates due to the provisioning requirement for dual rate loans that is put forwarded by the RBI.
Reports said that State Bank of India had closed down its teaser loan offer on grounds of higher provisioning requirements only. Lenders like Canara Bank have declined any plans to come up with such schemes. Ms. Archana Bhargava, Executive Director of the bank said that the bank has no such plans as the provisioning requirements for such loans are higher.