Recently, State Bank of India had to decide whether or not to extend loans to customers looking to invest in a housing project in Noida.

Though everything about the project looked good on paper, including the developer’s brand name, SBI decided against entertaining loans for it. Thanks to a partnership with online real estate start-up PropTiger, SBI got access to data that indicated that many customers who had already invested in this project were exiting due to delays and land issues.

Like SBI, banks are increasingly joining hands with online real estate portals to get market intelligence and buying trends. Crucial decisions such as going slow on taking exposure to housing projects in one city and stepping it up in another are increasingly being taken by banks based on information sourced from such online platforms.

Private sector lender ICICI Bank, for instance, is the preferred financial partner for three-year-old IndiaProperty.com, while three-year-old Housing.com has tie-ups with biggies such as Standard Chartered, HDFC and Axis Bank.

“Banks and private equity firms planning to take an exposure in real estate projects need a lot of data before lending at a project level or approving home loans to customers buying apartments in a particular project. We provide this data, which can be then sliced and diced,” said Dhruv Agarwala, Chief Executive Officer and Co-Founder of PropTiger.

Data analytics and ability to track user behaviour online is prompting the tie-up between banks and the start-ups. This includes data related to developer background, developer track record, information on new projects, demand-supply equation in a region and configuration and reigning prices, among others.

The monthly home loan uptake in the country is about ₹15,000 crore and analysts said partnerships with online players can increase uptake. The online sites get 3-5 million visitors a month and banks can convert these leads into business.

“We are great at technology, and banks are looking at tapping into customers who use online and mobile technologies for home buys. For banks, these tie-ups help them focus on their core competency,” said Advitiya Sharma, co-founder of Housing.com.

Project certification

In return, banks certify the projects listed on the website following a due diligence, giving them “trust and credibility”. For IndiaProperty.com, ICICI Bank approves home loans. “We get 3 million visitors per month, which a bank’s website would not be able to generate. Further, the traffic is from genuine homebuyers,” said Ganesh Vasudevan, CEO of IndiaProperty.com.

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