Bridging the gap between housing demand and access City Bank PLC.

Mashrur Arefin
Managing Director & CEO
City Bank PLC.

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“The gap is not appetite; it is access. Buyers want to own homes, but several frictions stand in the way.”

City Bank PLC is seeking to widen access to home finance through longer tenures, alternative income assessment, parallel loan processing and financing options that extend beyond conventional urban housing. Mashrur Arefin, Managing Director & CEO of City Bank PLC, says Bangladesh’s challenge is not a lack of demand for homeownership, but the financial, documentary and institutional barriers that stand between willing buyers and formal credit.

The Daily Star (DS): While housing demand continues to grow, formal home-loan penetration remains low. What are the primary bottlenecks?

Mashrur Arefin (MA): The gap is not appetite; it is access. Buyers want to own homes, but several frictions stand in the way. Formal home financing still carries the image of a paperwork-heavy process, while complicated land-title verification genuinely takes time.

Digital penetration in home finance has also lagged behind what we have achieved in other areas of retail lending. The relatively high customer equity contribution required during a loan application can deter prospective buyers, while interest rates have risen with the broader monetary cycle, putting additional pressure on affordability. Closing these gaps will require sustained, industry-wide effort.

DS: What home-finance products does City Bank currently offer to make borrowing more accessible?

MA: We have tried to build a comprehensive suite rather than a single product. For urban buyers, we finance flat and house purchases, full construction and renovation of existing homes.

In rural and semi-urban areas, we offer affordable home-construction financing designed around lower ticket sizes and simpler income profiles. This includes financing for semi-pucca structures, which conventional products often overlook.

We also offer a full-scale Shariah-compliant Islamic home-financing solution alongside conventional loans, so religious preference does not have to stand between a family and homeownership. Customers already carrying a home loan elsewhere can also use our takeover facility to transfer the loan to City Bank on improved terms and through a simplified process.

DS: What flexible repayment structures do you provide to lower the entry barrier?

MA: Flexibility matters as much as pricing when someone is committing to a decade or two of repayment. We offer tenures of up to 25 years, calibrated against the borrower’s age, income stability and the property itself, so instalments remain manageable.

For eligible customers, particularly those financing under-construction properties, we also have a provision for a grace period before regular EMIs begin. Our takeover facility allows customers to migrate existing home loans to us on improved terms. Alongside these options is our Shariah-compliant home-financing proposition for customers who want to finance a home without compromising their beliefs.

DS: How are you addressing the lack of traditional income proof and lengthy property-title verification?

MA: Both are genuine concerns. Many prospective borrowers, particularly businesspeople and those working in the informal economy, do not have conventional income documentation. Assessing them fairly requires more than a standard checklist.

We have therefore moved towards a 360-degree assessment of the customer, including physical visits and analysis of cash-flow patterns and the underlying business reality rather than relying on a single traditional proof of income.

Property verification remains time-consuming because land documentation in Bangladesh is still largely undigitised. Our teams must scrutinise records carefully to ensure collateral is unencumbered. We are digitising our own processes and training credit and business teams to make the journey smoother, while continuing to advocate for a more centralised and accessible property-documentation system.

DS: Does City Bank provide special support for women and first-time home buyers?

MA: Our interest rates follow market- and risk-based pricing, so every applicant is assessed on the same fair and transparent footing rather than receiving a different rate simply because of their category.

Processing fees are regulated by the central bank and are already lower than they were historically. For women customers, we can connect them with City Alo, our dedicated women’s banking proposition, for guidance and financial-services support throughout the home-buying journey.

We have also offered occasional fee waivers and campaigns for specific customer segments. A more structured home-finance scheme for women and first-time buyers is something we are actively considering as the market matures. Policy-level incentives encouraging these groups to buy homes and use formal financing would also help expand participation.

DS: What internal or digital improvements are helping reduce turnaround times?

MA: Speed is not a favour to the customer; it is what a long-term commitment like a home loan deserves from us. Rather than processing every step sequentially, we run credit assessment, legal vetting and documentation in parallel wherever possible. This meaningfully reduces turnaround time.

We are also working to fully digitise our credit and legal workflows using modern technology. Doorstep service means customers do not have to repeatedly visit branches for a process that already demands a considerable amount of their time.

At the same time, speed cannot come at the cost of ensuring that the property is unencumbered and secure. That protection ultimately serves the customer as much as the bank.

DS: What policy-level changes are needed to expand home finance further?

MA: A centralised land-document repository and mortgage database accessible to banks and financial institutions would significantly reduce both verification time and risk.

We would also welcome stronger policy support for affordable housing and green or climate-resilient housing, both of which will become increasingly important. Rationalising registration and stamp-duty costs would reduce the overall burden on genuine homebuyers.

Finally, a government-backed, incentivised refinance or pre-finance scheme developed with banks and financial institutions could meaningfully reduce acquisition costs for customers and help formal home finance reach a much broader segment of the population.