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GE Money, Wizard form joint venture

by praveen
September 21st, 2007

Home loans will be offered at 9.99 percent

Consumer financial services provider GE Money and international mortgage player Wizard on Thursday announced a joint venture, ‘Wizard Home Loans,’that will offer 9.99per cent floating interest rate on home loans.

“The joint venture will invest $200 million in equity in India and aims to set up over 250 branches across the country by 2011,” GE India CEO T.P. Chopra said here.
It would offer an aggressive interest rate of 9.99percent to consumers, he said.

The prevailing market rate for home loans is between 11 and 12 percent for varying tenures. The domestic home loans segment has been growing at a compounded annual growth rate of 30 percent since 2001. According to the National Housing Bank, India faces a shortage of 30 million housing unites.

Wizard Chairman Mark Bouries said the company Bouris said the company hoped to attain the $2-billion asset base of home loans by 2011. He said consumers would be offered home loans through franchisees, which would be paid an upfront fee and a monthly commission as long as the loan remains on the company books.

wizard India CEO Egisto Franceschi said the cost of funds would be relatively lower as the company would get funds from its GE relationship.

The company planned to be among the top five players in the India home loan market in the next 5-10 years, he said. In addition, Wizard will provide loans against property to enable consumers to meet their needs such as business expansion and any other financial requirements, he added.

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