Developing insights into a leading Housing Finance Company in India

Background and Challenge

Our client, the bank wanted to gain insights into the financial strength and operational efficiency of a leading housing finance company (HFC) in India. The HFC was the first of its kind established in late seventies and was operating with close to 200 branch offices all over India.

Top management wanted to understand the company with respect to the following factors

  • Customer and Product focus
  • Processes with emphasis on credit and collections
  • Cost structure and financials
  • Corporate Structure
  • To develop future outlook for the HFC between 2005 and 2008

The bank wished to demystify how the HFC seemed to have it all: the market share, profitability and a culturally strong work force, thus they approached UC.

Approach and Recommendations

To develop insights into the HFC, UC adopted the following approach:

  • Reviewed the strategic drivers and built insights into the HFC:

    1) Conducted desk research by analysing the financial data publicly available for the HFC over past 3 years

    2) Interviewed around 50 respondents spread across 10 cities including employees of the HFC and its key partners which included valuers, builders, DSA’s etc.

    3) Studied the industry trends, HFC’s past and current performance and developed scenarios for its future growth

  • The insights were developed

    1) The HFC enjoyed high spreads due to its ability to raise funds at lower rates compared to other HFC’s and many Banks

    2) It had one of the lowest cost income ratios as well as the lowest NPA levels in the industry due to the factors w.r.t.

    Unique sourcing strategies

    Branch office level people profile

    Technical appraisal methods

    Integrated systems

    Evolved screening and appraisal systems

    Efficient and customised recovery tactics


Developed these insights and provided top management at SCB with the possible future advantages and disadvantages in the current business and delivery model at the chosen HFC.