The Central Bank of Nigeria has promised to invest in some microfinance banks across the country and build their capacity to provide housing finance to aspiring homeowners.
According to the CBN, the initiative, which falls under the ‘My Own Home’ campaign of the Federal Government, is aimed at addressing the housing needs of people who cannot be on mortgage but wish to build their houses in stages.
A Deputy Director at the CBN and Head, Project Administration Team of the National Housing Fund Programme, Mr. Adedeji Adesemoye, said the initiative was in partnership with the Frankfurt School of Management and AFC Consultants International, Germany.
The organisations are expected to build the capacity of the microfinance banks before they can access funding from the CBN.
Adesemoye said the programme, also known as Housing Microfinance, was the third component of the $300m borrowed from the World Bank in 2013, part of which was used to establish the Nigerian Mortgage Refinance Company.
According to him, nine microfinance banks have been chosen across the six geopolitical zones of the country for the scheme.
Adesemoye stated, “Housing microfinance is closer to our traditional sense of incremental construction. Not everyone has money to finance mortgage but under the microfinance scheme, a homeowner can stretch his building plan in such a way that he takes different tranches of loan as he builds.
“Out of the nine banks that have been chosen, one, LAPO Microfinance Bank, has a technical assistance, so it will be financed; but the remaining eight will get technical assistance known as technical agreement cooperation, with us in which we will be able to develop their capacity.”
He added that the initiative was for everyone, and that the CBN aimed to educate the younger generation on the need to start the process of owning homes early.
“We need to educate our people that owning a home with a mixture of equity and debt is not a negative thing; having a home that you will live in the next 50 years does not require you to spend all you have,” Adesemoye stated.
He added that the programme would allow the system to have a larger financial pool for housing construction that would open up the economy and provide jobs.
“The objective is to catalyse the growth of the housing sector through de-risking the housing finance value chain and improving access to finance,” he said.
Source: ( Punch Newspaper )