33-year-old Nagamma, is a popular vegetable vendor in Balkum, Thane. She never compromises on quality, and has an uncanny knack of remembering preferences of her regular customers. During the COVID-led lockdown in Maharashtra, Nagamma not only managed to remain afloat, but she also managed to clock in monthly income of Rs 45,000 to support herself and continue her son’s education.
While Nagamma is a microentrepreneur with a stable income for close to a decade, she has been unable to fulfil her dream to move out of a chawl and procure a one-room kitchen in a nearby apartment complex, despite her efforts to apply for a home loan twice over the last ten years.
The impediments to her homeownership dreams, is her status as a woman estranged from her husband and the lack of registered business and income documents, that exclude her from the ambit of formal finance. Nagamma’s story is that of most women employed informally.
While primal caregiving instincts make their own home of their own a necessity, and these women are astute money managers, they continue to face rejection when it comes to housing finance from traditional financial institutions. This is because they fail to tick checkboxes when it comes to identification, income and employment track record.
The Agrim promise
As a new age finance company, our mission is to reverse this trend, and make home ownership dreams come true for many women borrowers such as Nagamma. We take inspiration from the microfinance sector where more than 85% are women borrowers with a low default rate.
We are one of the few housing finance companies that does not discriminate against single women in our home loan policies. Home loan applications have traditionally been rejected by traditional financial institutions for the lack of spouse or a male relative who can step in as a guarantor.
Every aspiring borrower, in the informal, self-employed category can access home loans through the Agrim app and get a pre-approved home loan in simply 10 minutes. We are constantly leveraging technology provide every borrower a shorter and hassle-free loan experience.
Secondly, we are encouraged by a spate of policies, such credit linked subsidy provided by the Pradhan Mantri Awas Yojana under the Housing for All initiative by the Government. PMAY now recognises any adult member irrespective of marital status as an adult earning member of the family. Further, the Budget announcement of collating a central database for informal workers, has enthused us further.
A rocky road ahead
However, we are cognisant of the fact that the road ahead is not as easy. Women in the informal sector, have accepted the patriarchy as a way of life, and often discount their entrepreneurial capabilities. They are happy to handover financial decision making to the men in the family, despite being an equal or sometimes a greater contributor to the family income.
Solutions as we see it are not easy. Even with policy support, the onus lies on us financial service providers to instil confidence among potential women borrowers with financial education, leveraging alternate data within approved regulatory structures to assess creditworthiness and finally assessing each case on individual merit.
What better an occasion than International Women’s Day to make good on our pledge!
Yes, you can. If you are having trouble getting a home loan approval because of your income, you are not alone. Many first-time homebuyers have the same problem and find that they can’t get the money they need. That doesn’t mean that you should give up on the idea of homeownership. If you are wondering about the options for people