Transforming Secured Lending: Re-imagining Home Loans (Amicus Capital)

Summary

• India's housing loan market was valued at ₹27.37 trillion in 2024 and is projected to reach ₹46.60 trillion by 2029.p.2
• Outstanding individual home loans grew 16.4% from FY23 to FY24.p.2
• Nearly 80% of secured lending processes can now be automated, while the remaining 20% involve complex manual workflows.p.7
• Nearly 50% annual churn of field staff creates significant operational challenges in home loan journeys.p.19
• Automated access to digitized records reduces title search report preparation time by 30-40%.p.27
• 48% of individual housing loans from Housing Finance Companies fall under the up to ₹2.5 Million outstanding loan segment.p.12
• Housing finance has a 47% share in retail credit despite a housing shortage.p.11

Key insights

1. The India Stack framework, with Aadhaar-based eKYC, UPI and the Account Aggregator, has reduced onboarding time from days to minutes.p.7
2. Major bottlenecks remain in legal verification, property valuation and land record digitization.p.7
3. Digitization can automate around 80% of secured loan processes and increase productivity by around 20%.p.21
4. Automated valuation models remove the 2-3 day manual process for property valuations.p.26
5. Digital KYC and the Account Aggregator framework enable faster credit assessment and rejection of unqualified leads.p.24
6. Legacy monolithic architectures lack integration and are not scalable, motivating a centralized, API-first loan origination system.p.35
7. Early Warning Systems use payment patterns and micro-economic trends to identify risks and reduce defaults.p.29