Essay by shukla March 2004

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Against the milieu of rapid urbanization and a changing socio-economic scenario, the demand for housing has grown explosively. According to the National Building Organization (NBO), the total demand for housing is estimated at 2 million units per year and the total housing shortfall is estimated to be 19.4 million units, of which 12.76 million units is from rural areas and 6.64 million units from urban areas. The housing industry is the second largest employment generator in the country. The Housing finance sector has assumed significant importance in the country.


Launched in October 22 1977 with a share capital of Rs. 10 crores, HDFC has since emerged as the largest residential mortgage finance institution in the country. It today covers the entire country with more than 120 offices, cumulative approvals and disbursements of over Rs. 40,000 crores and Rs. 33,500crores respectively and Total Assets of Rs.

21,459 crores. The group added together would constitute a total asset base of over Rs. 50,000 crores. We have come a long way from the massive competition by providers of housing finance has helped consumers considerably.


The primary objective of HDFC is to enhance residential housing stock in the country through the provision of housing finance in a systematic and professional manner, and to promote home ownership. Another objective is to increase the flow of resources to the housing sector by integrating the housing finance sector with the overall domestic financial markets. During the past decade, HDFC has nurtured the development of the housing finance industry by helping promote housing finance institutions in partnership with commercial banks and private sector institutions.


HDFC's main goals are to

a)Develop close relationships with individual households,

b)Maintain its position as the premier housing finance institution in...