Central Bank Partners with Shriram Housing Finance for MSME Loans
Central Bank of India collaborates with Shriram Housing Finance to offer MSME loans, aiming to expand loan portfolios and enhance customer service, leveraging an 80% book rate for loans originated by Shriram Housing Finance.
by Damodharan N
Updated Jul 13, 2024
Table of Content
Central Bank of India has entered a strategic co-lending partnership with Shriram Housing Finance Limited to offer MSME loans. This collaboration aims to expand their loan portfolios significantly.
Shriram Housing Finance, a subsidiary of Shriram Finance Limited and registered with the National Housing Bank, serves over 70,000 borrowers, primarily self-employed individuals from Tier-2 and Tier-3 cities.
Under this arrangement, Shriram Housing Finance will originate and process MSME loan proposals according to jointly formulated credit parameters and eligibility criteria. Central Bank of India will take 80% of these loans onto its books under mutually agreed terms.
The co-lending initiative is expected to enhance customer experience and market reach, benefiting both institutions and their clients.
Read the full announcement Here
Central Bank of India
Central Bank of India, established in 1911, holds the distinction of being India's first commercial bank fully owned and managed by Indians. Founded by Sir Sorabji Pochkhanawala with a vision of national pride, the bank has navigated over a century of challenges, transforming threats into opportunities.
It pioneered several banking innovations, including the Home Savings Safe Deposit Scheme in 1921 and the introduction of India's first credit card, Centralcard, in 1980. Even after nationalization in 1969, the bank continued to lead with initiatives like the Merchant Banking Cell and Quick Cheque Collection Service.
With a vast network spanning all states and most union territories of India, Central Bank of India remains a pivotal player in fostering economic growth through extensive support to agriculture, small-scale industries, and self-employment schemes, earning trust from major corporate clients nationwide.
Shriram Housing Finance
Shriram Housing Finance Limited (SHFL) is a housing finance company affiliated with the Shriram Group and regulated by the National Housing Bank (NHB). Established with a strong legacy from the Shriram Group.
SHFL focuses on providing financial solutions for residential properties, including loans for home purchase, construction, and against property. With a commitment to customer satisfaction and a history rooted in successful diversification across various financial sectors, SHFL remains dedicated to making homeownership accessible and fulfilling the dreams of its clients.
Central Bank Partners with Shriram Housing Finance for MSME Loans - FAQs
1. What is the co-lending partnership between Central Bank of India and Shriram Housing Finance Limited about?
It's a strategic collaboration where Central Bank and Shriram Housing Finance join hands to provide MSME loans.
2. Who can benefit from this partnership?
Self-employed individuals and businesses in Tier-2 and Tier-3 cities looking for MSME loans can benefit.
3. What role does Shriram Housing Finance play in this partnership?
They will originate and process MSME loan proposals based on jointly decided credit parameters.
4. What role does Central Bank of India play in this partnership?
Central Bank will take 80% of these MSME loans onto its books under agreed terms.
5. How will customers benefit from this co-lending initiative?
It aims to provide easier access to MSME loans and enhance customer service.
6. Why did Central Bank of India choose to partner with Shriram Housing Finance?
To expand its loan portfolio and reach more borrowers across India, especially in smaller cities.
7. What regulatory approvals are required for such partnerships?
They need approval from the Reserve Bank of India (RBI) and must comply with National Housing Bank (NHB) guidelines.
8. How will this partnership impact the market presence of Central Bank and Shriram Housing Finance?
It's expected to strengthen their market presence and increase their footprint in the MSME loan segment.
9. What are the long-term goals of this co-lending arrangement?
To foster economic growth by supporting more MSMEs and promoting entrepreneurship.
10. How does this partnership reflect Central Bank of India's historical initiatives?
It continues the bank's legacy of innovation and support for economic development, dating back to its founding in 1911.