ICICI Bank, India’s largest private lender, has proposed to offer home loans of up to Rs 15 lakh at the base rate — the minimum lending rate — in rural areas.
The bank’s base rate currently stands at 9.70 per cent. The ticket size under the product christened ‘ICICI Bank Saral-Rural Housing Loan’ is between Rs 5 lakh and 15 lakh and the tenure is 3-20 years, it said.
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The rate of interest will be floating, which means it will be revised with the movement in the base rate across the loan tenure. Rural borrowers can avail of the loan to purchase or construct or renovate a home, it said. ICICI Bank and its larger rival SBI too provides home loan to women borrowers at the base rate at a similar pricing level. “ICICI Bank is committed to supporting the socio-economic development of a larger section of society,” Executive Director Rajiv Sabharwal said in a statement.
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According to RBI, loans of up to Rs 20 lakh in rural areas qualify as priority sector lending wherein banks have to mandatorily lend 40 per cent of their annual fresh advances to the disadvantaged. If there is a shortfall, the amount gets invested in low-yield rural infrastructure development fund.
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