MUMBAI: The chief of LIC Housing Finance, the largest home loan company in India, has called for capping of interest rates on loans in the affordable housing segment stating that nothing about some of the rates being charged in this segment is affordable. MD and CEO Tribhuwan Adhikari said some housing finance companies are charging interest rates of 15-16% in the affordable housing segment and suggested that the regulator should prescribe a ceiling on spread over funding costs.“Affordable housing finance is a misnomer because the borrower definitely cannot afford 16%-17%,” he said. He added that Reserve Bank or National Housing Bank could consider capping lending spreads. In the case of banks, RBI links their floating rate to the repo rate. However, Adhikari did not see a case for linking HFC rates to external benchmarks because about half of the sector’s borrowings come from banks. Unless housing finance companies received similar access to low-cost funding, such a move would put them at a disadvantage.Adhikari said LIC Housing Finance itself is cautiously operating in the affordable housing segment through a “banking surrogate” product that assesses borrowers using bank statements and GST filings instead of income tax returns or salary slips.On the company’s growth, Adhikari said LIC Housing Finance expects its loan book to stand at around Rs 3.5 lakh crore by the end of FY27. The company’s net profit in Q1FY27 rose 10% to Rs 1,499 crore and loans grew 14% — the strongest in four to five years and the momentum would continue, he said. Its loan book growth has trailed peers because of repayments and prepayments, but LICHF is now focused on accelerating growth while retaining its AUM lead over rivals.