Country's top mortgage lender HDFC today announced acquisition of 41 per cent stake in education loan provider HDFC Credila Financial Services -- marking its entry into a specialised market estimated at over Rs 30,000 crore.
HDFC is purchasing the 41 per cent equity from DSP Merrill Lynch Capital Ltd, an Indian subsidiary of global financial services major Merrill Lynch.
Commenting on the deal, HDFC's Senior General Manager (Treasury) V S Rangan told PTI that it was "a very small investment" at less than Rs 10 crore for the company, but marked its entry into a fast-growing market.
"Education loans provide a large business opportunity in the country with more and more people going for higher studies," Rangan said.
"The market for student loans is continuously growing... currently, it is estimated at about Rs 30,000 crore and is growing every year at a rate of 25-30 per cent," Rangan said. Currently, the market is mostly dominated by the banks, but the requirement for student loans is growing day-by-day, he added.
Rangan said the company would disburse loan for studies in India as also overseas.
The deal is subject to compliance with applicable regulations, HDFC said.