Mumbai: State-run Central Bank of India Wednesday signed an agreement with Tata Housing to offer a special home loan product exclusively designed for pensioners.
"We have signed an agreement with Tata Housing for our newly developed home loan product that will be offered to the pensioners at the upcoming Tata Housing's project at Washim on Mumbai's northern outskirts," Central Bank General Manager R Sangapure said.
The product, CentHome Swabhiman Plus, which is yet to be approved by the regulator RBI, seeks to fund home buyers in the age group of 55-70 at a concessional rate, he said.
While loans under Rs 30 lakh will attract only the bank's prevailing base rate, those above this amount will be available at 0.25 percent above the base rate. The bank has scrapped processing fee on loans under this product, he said.
Tata Housing is developing a township at Washim, where one of the projects with 150 housing units is being developed for pensioners. Tata Housing Managing Director Brotin Banerjee could not be reached for comments.
Explaining the rationale behind the product, Sangapure said, "this is aimed at helping the elderly as banks mostly do not lend to people after or near retirement. We thought of changing this and helping the needy home buyers.
The product seeks to offer reverse mortgage option to customers unable to service the loan after some time. It also seeks to fund the borrowers who want to avail of the special medical fund being created by Tata Housing, which has priced Washim housing units in Rs 25-40 lakh range, Sangapure said.
About the city-based lender's plan to launch a special product to help redevelopment of old housing societies in Mumbai, which seeks to directly finance the residents of the society instead of the developer, as is the practice, he said, the bank will approach RBI again with the proposal.
RBI has objected to the bank's plan to fund demolition and rehabilitation costs under this scheme, he said.