Now Reading: PNB Housing targets micro loans, affordable housing for higher margins
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PNB Housing targets micro loans, affordable housing for higher margins
PNB Housing targets micro loans, affordable housing for higher margins
PNB Housing Finance is entering micro housing loans and small developer finance to lift loan spreads and profitability. The lender expects affordable and emerging businesses to rise from 41% of assets now…
The Story in Brief
PNB Housing Finance is entering micro housing loans and small developer finance to lift loan spreads and profitability. The lender expects affordable and emerging businesses to rise from 41% of assets now to 45% by FY27 and 50% by FY28, Mint reports. Micro housing loans could earn 14-15%, against about 12% for affordable housing loans. The company is also financing small redevelopment projects in Delhi, Ahmedabad, Bengaluru and Hyderabad, with average loans of about Rs 25 crore.
ETBFSI reports that affordable housing assets reached Rs 8,560 crore in June 2026, up 49% year on year. PNB Housing targets 18-20% overall asset growth in FY27 and expects margins to improve from Q2FY27. Its June-quarter net interest margin was 3.50%, down from 3.74% a year earlier.
The Indian Opinion
The easy story is that higher-yield loans will quickly fix PNB Housing’s margins. That ignores the risks in micro borrowers and small redevelopment projects, where underwriting and collections can be harder. The opposite claim, that affordable lending is merely a low-return burden, is also too broad: the segment has grown sharply and can widen the customer base. Investors should watch whether disbursement growth arrives without a rise in credit costs, while NIM moves above 3.50%.
Sources (2): livemint.com, bfsi.economictimes.indiatimes.com
This story was synthesised by AI from the 2 sources linked above.
Updated: this story now draws on 2 sources.
