BIS Review 5/2005  5  Credit cards, debit cards, personal loans and consumer durable loans are catching up fast. Refrigerators, air conditioners, VCRs, Televisions are now available on credit. The consumers are forced to save when a specific amount is cut from their salary every month to pay the installment. Mortgage financing is one way in which wealth is created.
For example, you bought an apartment for Rs. 100,000 and paid Rs. 20,000 as equity and borrowed Rs. 80,000 from the bank. Next year, let us say that the value of the same apartment rises to Rs. 120,000/-. Your loan is still Rs. 80,000, but your own equity has now doubled from Rs. 20,000 to Rs. 40,000.