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From Phygital Models To AI Scores: The Future Of Home Lending In Tier 2 & 3 Cities

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From Phygital Models To AI Scores: The Future Of Home Lending In Tier 2 & 3 Cities


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Atul Monga of BASIC Home Loan highlights how fintech, local agents, and partnerships are making home loans more accessible in Bharat’s smaller towns.

In smaller towns, one of the main challenges is that a lot of people don’t have formal income proof or a credit history.

In smaller towns, one of the main challenges is that a lot of people don’t have formal income proof or a credit history.

Home loan accessibility in India has long been a challenge, especially beyond metro cities. While urban borrowers often have easier access to credit thanks to formal incomes and established credit histories, millions in Tier 2 and Tier 3 cities continue to face hurdles ranging from lack of awareness to documentation gaps. With the rise of fintechs, local partnerships, and technology-driven solutions, the landscape is gradually shifting.

In this interaction, Atul Monga – CEO & Co-Founder, BASIC Home Loan, shares insights on the biggest challenges, innovations, and the road ahead for making homeownership more inclusive across Bharat.

1- What are some of the biggest challenges in making home loans accessible in smaller towns and cities?

In smaller towns, one of the main challenges is that a lot of people don’t have formal income proof or a credit history. Additionally, financial literacy tends to be lower, which can confuse the loan process. Lack of awareness about loan eligibility, benefits, and the application process often leads to consumer inertia, and many borrowers simply don’t take the first step. Additionally, things like inconsistent documentation, limited lending options, and the need for physical verification of the property further create more friction.

Today, banks and fintech companies are attempting to address this scenario in various ways. The solution lies in a phygital approach, which brings together digital tools and a strong network of local agents. These agents work directly with customers, guiding them step-by-step, building trust, and making sure even those with limited financial paperwork can navigate the process smoothly.

2- What are some of the challenges that people and lenders face when it comes to Last Mile Connect?

Last Mile Connect in home lending can be quite challenging, especially in smaller towns. The digital infrastructure is still developing in many areas, which means things like poor internet access, patchy documentation, and low financial awareness can make it hard for lenders to accurately assess a borrower’s profile or risk level.

Many borrowers feel unsure about navigating the process online without any personal guidance. There’s also a fear of fraud, and the cumbersome paperwork involved can feel overwhelming. Without someone local to assist, even well-intentioned or eligible borrowers often drop off halfway through.

The good news is that things are gradually improving now, thanks to steady advancements in fintech and digital infrastructure that are making loans more inclusive and accessible than ever before.

3- How are fintechs helping people with informal incomes or no credit history get access to home loans?

Fintechs have made home loans more accessible for people without formal incomes or credit history. Traditionally, lenders relied heavily on salary slips and credit scores to determine the borrower’s creditworthiness, but this leaves out a major chunk of the population, especially from the informal sector.

Now, with the help of technology, we are able to look beyond such traditional indicators. By using alternative data like bank transaction patterns, utility bill payments, and digital footprints, we can create a reliable credit tracking system for people who don’t fit the conventional mold.

4- What are the common concerns or roadblocks that first-time homebuyers in unreserved areas usually face?

First-time homebuyers in unreserved or semi-urban areas often struggle with unclear or incomplete property titles, which can create legal complications and make it difficult to get a loan approved. Many of these areas also lack RERA-approved projects, which adds another layer of risk for both buyers and lenders.

There’s often limited awareness about how home loans work, what’s required, how interest rates are structured, or what documents are needed. Another common hurdle is that property values in these regions tend to be modest, but lenders may still have high minimum loan amounts, making it harder for buyers to qualify.

Lenders, Fintechs like BASIC Home Loan, and local real estate developers are working together to bridge the gap and create more accessible loan products, streamline documentation, and guide homebuyers through the process. This collective effort would certainly help unlock home ownership for a segment that has long been underserved.

5- Why is local presence important like field agents or developer tie-ups, important in driving home loan adoption beyond metro areas?

Local presence plays an important role when it comes to building trust, especially in the heartland of Bharat, where digital-only models still feel distant or unfamiliar. For many first-time borrowers, human interaction still matters, and this is where the field agents come in. They don’t just help with the paperwork, but also build confidence, address consumer concerns and guide them through every step of the journey.

Developer tie-ups are equally important. When we work with trusted local builders, we can ensure that the properties are already verified and pre-approved for financing, which significantly reduces the loan process. Which is why we have partnered with real estate developers to offer curated property options and faster loan turnarounds to customers.

6- How are strategic partnerships between lenders, fintech platforms, and HFCs unlocking housing loan access in India’s Tier 2 and Tier 3 cities?

Strategic partnerships are at the heart of expanding home loan access, especially in India’s smaller cities. By working together, fintechs, lenders, and HFCs will be able to bring speed, flexibility, and trust to markets that have long been underserved, thereby making home ownership a more realistic goal for millions across Bharat.

7- What are some innovations or changes you see coming that could make home buying easier and more inclusive across India?

Homebuying in India is witnessing crucial transformations, especially outside the metros. Digitised property records, e-KYC, and geo-tagging of properties are already beginning to ease long-standing verification bottlenecks.

AI-led credit scores will further open doors for borrowers with informal incomes or limited credit backgrounds. Embedded finance options, where home loans are integrated directly into real estate platforms, can further make the process seamless for borrowers.

The future of home ownership in India will be shaped by a combination of hyperlocal support and smart, scalable technology. It’s about bringing the same ease of access and trust that metros enjoy to Tier 2, Tier 3 cities, and eventually to every corner of Bharat.

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Fare relief move: Air India waives change, cancellation fees on domestic bookings after IndiGo disruption – The Times of India

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Fare relief move: Air India waives change, cancellation fees on domestic bookings after IndiGo disruption – The Times of India


Five days after widespread flight disruptions triggered by IndiGo cancellations, Tata Group-owned Air India on Saturday announced a special waiver on change and cancellation charges for eligible domestic bookings, aiming to offer relief to affected travellers, PTI reported.The airline said customers who booked tickets on Air India or its subsidiary Air India Express on or before December 4 for travel up to December 15 can make a one-time change or cancellation without paying the usual fee, provided the request is made by December 8, 2025. In case of rescheduling, any fare difference will still be applicable.

Aviation Meltdown Forces DGCA To Roll Back Weekly Pilot Rest Norm After IndiGo Cancellations

Under the waiver, passengers can either reschedule their journeys to a later date within the validity of the purchased ticket without paying rescheduling charges or cancel their bookings and receive a full refund, with no cancellation fee applied, the airline said.Air India also said it, along with Air India Express, has “proactively” capped economy-class airfares on non-stop domestic routes from December 4 to prevent price spikes driven by automated demand-supply algorithms. The carriers are also in the process of ensuring compliance with the latest directive issued by the Civil Aviation Ministry on airfare caps.





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Volkswagen capex recalibration: Automaker pares 2030 investment to $186 bn; China, US headwinds grow – The Times of India

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Volkswagen capex recalibration: Automaker pares 2030 investment to 6 bn; China, US headwinds grow – The Times of India


Volkswagen Group plans to invest €160 billion ($186 billion) through 2030, a scaled-down outlay that reflects tightening capital allocation as Europe’s largest automaker grapples with mounting pressure in its two biggest markets — China and the United States, Reuters reported.The investment figure, announced by Volkswagen CEO Oliver Blume, is part of the company’s rolling five-year capital expenditure plan, which is updated annually. The latest commitment compares with €165 billion earmarked for 2025–2029 and €180 billion for 2024–2028, with 2024 marking the peak year for spending.Since that peak, the group — which houses brands such as Porsche and Audi — has been squeezed by higher costs and weaker margins, hit by US tariffs on imported vehicles and intensifying competition in China. The strain has been felt most acutely at Porsche, which derives nearly half of its sales from the US and China combined.Porsche recently unveiled a significant rollback of its electric vehicle strategy as profits came under pressure. Speaking to Frankfurter Allgemeine Sonntagszeitung, Blume said the focus of the latest investment plan was firmly “on Germany and Europe,” particularly in products, technology and infrastructure.Blume added that discussions on an extended savings programme at Porsche are expected to continue into 2026. He also said he does not expect Porsche to grow in China, though localising production across the wider Volkswagen group remains an option. A China-specific Porsche model could make sense at some point, he said.On Audi, Blume noted that any decision on building a manufacturing plant in the United States would depend on whether Washington offers substantial financial support.Blume, who will step down as Porsche CEO in January to concentrate fully on running Volkswagen Group, said his recent contract extension as Volkswagen chief executive until 2030 signalled continued backing from the Porsche and Piëch families as well as the German state of Lower Saxony, the company’s largest shareholders.“But it is true, of course, that shareholders have suffered losses since Porsche went public three years ago. I, too, must face up to this criticism,” he said.





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How IndiGo Managed To Hold A Country Of 1.4 Billion People Hostage, Forced Govt To Bend Rules | Analysis

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How IndiGo Managed To Hold A Country Of 1.4 Billion People Hostage, Forced Govt To Bend Rules | Analysis


At a time when most Indian airlines are posting losses, IndiGo stands out as the only profitable carrier. Yet, while loss-making airlines managed to comply with DGCA directives within the allotted 18-month period, the one airline turning a profit failed to do so. The DGCA had provided ample time for compliance and workforce planning. But while others focused on meeting regulatory requirements, IndiGo appeared to pursue a different strategy—creating disruption to pressure the government. Incredibly, this approach worked: instead of imposing penalties, the government chose to relax the norms.

Aviation expert Harsh Vardhan squarely called this entire crisis a failure of IndiGo’s management. He said this is an extremely unprecedented situation. Passengers have been suffering for three days, and this is the peak tourist, wedding, and business season. IndiGo’s claim that the new FDTL policy suddenly created problems is nothing but a management failure. The policy wasn’t introduced overnight—it was formulated over years of deliberation and was finalised a year ago.

Harsh Vardhan reminded that the soft launch of the FDTL took place on July 1, 2025, and it was fully implemented from November 1, 2025. Other operators like Air India and SpiceJet made timely adjustments, which is why no major crisis emerged there. What surprises him most is the timing—if the policy was effective from November 1, why did this sudden “rampage” begin only a month later, at the start of December?

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“The Government of India has decided to institute a high-level inquiry into this disruption. The inquiry will examine what went wrong at Indigo, determine accountability wherever required for appropriate actions, and recommend measures to prevent similar disruptions in the future, ensuring that passengers do not face such hardships again,” said the Ministry of Civil Aviation in a statement.

No one knows what will come out of the inquiry but, interestingly, IndiGo got rewarded for its blackmailing,  instead of getting punished as the government relaxed norms. 

Due to the IndiGo induced turbulence, the airfare on key routes touched Rs 80,000 to Rs 90,000. IndiGo didn’t merely cancel flights—it brought the system to a standstill, grounding aircraft, showcasing its clout, and effectively challenging the government to respond. Instead of asserting its authority, the NDA government backed down and rolled back its own directive. Through deliberate mismanagement, the airline pushed the system toward chaos. The suspension of over a thousand IndiGo flights severely disrupted the economy, sending hotel prices and ticket fares on other airlines soaring.

“The central government has ordered a probe and refunds—but the question is: when the monopoly of private companies and the government’s silence come together, who will protect the common people? Who are you working for? The public or the interests of big corporate houses?” Former Delhi Dy CM Manish Sisodia rightly questioned the government.

Shockingly, a country of 1.4 billion people relies primarily on just two major domestic carriers—IndiGo and Air India. IndiGo’s dominance is so significant that even Leader of the Opposition Rahul Gandhi publicly criticised the government for its oversight failures. “IndiGo fiasco is the cost of this Govt’s monopoly model. Once again, it’s ordinary Indians who pay the price – in delays, cancellations and helplessness. India deserves fair competition in every sector, not match-fixing monopolies,” said Gandhi. 

For two decades, successive governments have allowed major airlines to collapse instead of restructuring them under new ownership. Jet Airways and Kingfisher Airlines are prime examples: both could have been revived by removing problematic promoters, yet no institutional mechanism was activated. The pattern repeated itself with Go First. When three airlines vanish in a decade, it signals not merely corporate failures but a systemic unwillingness to safeguard competition and consumer interest, wrote Prashant Tewari, public policy expert, mentioned in a recent report in The Pioneer.

Today, IndiGo controls over half of India’s domestic aviation market, with the Air India group holding most of the remainder. Smaller airlines operate on the margins, too weak to influence pricing or service standards.

Tewari wrote that disappearance of three airlines within years show government’s failure of protecting competition and consumer interest. 

This duopoly-like environment has suffocated passengers: airfares on busy domestic routes routinely exceed those for comparable distances in Europe, Southeast Asia, or even the United States. A two-hour flight within India can cost more than a four-hour international journey elsewhere.

“IndiGo airline fiasco shows that Modi govt is either incompetent or in collusion. In either case, India deserves better. People have never suffered so much,” said Former Delhi CM and AAP convener Arvind Kejriwal.

For years, India’s aviation sector has needed at least eight to ten robust operators to foster true competition, stabilise fares, and minimise disruptions. Instead, new entrants face steep barriers, licensing moves painfully slowly, and foreign carriers seeking expansion are hindered by outdated protectionist policies disguised as national security concerns. This refusal to liberalise the skies has turned India into one of the world’s most expensive domestic aviation markets.

According to Tewari, the duoploy ecosystem suits certain entrenched interests. With opaque decision-making, India’s aviation sector functions with minimal accountability, he opined.

Though the government’s UDAN scheme was launched to make air travel accessible to the common citizen, soaring fares have made flying increasingly unaffordable.

Besides opening new airports, the government must urgently liberalise the sector, encourage new domestic players, revive grounded airlines under competent management, and allow credible foreign carriers to compete under regulated conditions. Until then, Indian travellers will continue to pay excessively, learning the same harsh lessons again and again.



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