Archive · 19 Jan 2026
India Launches First Mortgage-Backed Securities
India recently launched its first Mortgage-backed Pass-Through Certificates (PTCs) in May 2025.
These are special financial instruments that turn home loans into something that can be bought and sold on the stock market.
This is a big deal because it makes the housing finance market more transparent and gives investors new options.
The loans are very stable, with low default rates, and this new system could help more people get home loans.
However, India is being careful not to repeat mistakes from other countries, like the US, where similar systems led to big financial problems.
The goal is to make the housing market stronger and more flexible without taking too many risks.
India launched its first Mortgage-backed Pass-Through Certificates (PTCs) in May 2025, issued by LIC Housing Finance and structured by RMBS Development Company Ltd on the National Stock Exchange (NSE).
Outstanding housing loans in India exceed ₹30 trillion, with a steady annual growth rate of 12–14%, driven by urbanization and rising formal incomes.
The housing finance market is dominated by banks and housing finance companies, with securitization playing a marginal role, accounting for just a low single-digit share of outstanding credit.
India's regulatory framework requires lenders to hold housing loans for a minimum period before securitizing them and to retain a slice of the credit risk, ensuring accountability and discouraging careless underwriting.
The launch of RMBS is seen as a measured experiment to deepen the housing finance market, with an emphasis on gradual market development and conservative underwriting to avoid systemic risks.
- Who
- LIC Housing Finance and RMBS Development Company Ltd
- What
- Launch of India's first Mortgage-backed Pass-Through Certificates (PTCs)
- When
- May 2025
- Where
- National Stock Exchange (NSE)
- Why
- To diversify housing finance and improve market transparency
- Launch Date
- May 2025
- Issuer
- LIC Housing Finance
- Structurer
- RMBS Development Company Ltd
- Listing Platform
- National Stock Exchange (NSE)
- Outstanding Housing Loans
- ₹30 trillion
- Annual Growth Rate
- 12–14%
- Home-Loan Delinquencies
- Below 2%
- Securitization Share
- Low single-digit share of outstanding credit
- Minimum Risk Retention
- 5%
