Pension Fund’ll Boost Mortgage Finance

• Pension Fund’ll Boost Mortgage Finance, Housing – Experts

Stakeholders in the financial services sector are calling for the investment of pension funds in housing and mortgage finance in order to stimulate the economy.

They note that the rate of homeownership in the country is very low and will not improve unless there is expanded access to mortgages.

The Director-General, National Pension Commission, Mrs. Chinelo Anohu-Amazu, at the mortgage banking sub-sector’s annual CEOs retreat organised by the Mortgage Banking Association of Nigeria, said the pension sector could offer several benefits to the housing sector.

“It is in the best interest and benefit of the pension industry to support the housing and mortgage finance sector as it will lead to job creation and sustainability, economic stimulation and enhanced standard of living for contributors,” she said.

She, however, stated that industry players needed to come up with products that meet the minimum requirements for pension fund investment, and ensure professionalism and ethical conduct in business dealings.

“There should be continuous consultation and engagement by all relevant stakeholders in order to address the challenges in the sector and institute a strong, viable and stable mortgage and housing sector,” Anohu-Amazu said.

The President, MBAN,Dr. Femi Johnson, said that a lot had been done in the recent past to create an enabling environment for mortgage banking and housing finance as well as to deepen the mortgage market, including the integration of customers with the Bank Verification Number platform and the issuance of the Nigeria Uniform Bank Account Number to mortgage bank customers to facilitate online transactions.

He said, “The upside is that when it is done right, housing, housing finance and mortgage banking have immense potential for economic growth through backward linkages to the land markets, building construction industry, building materials’ industries, labour market and housing-related consumer loans, as well as its forward linkages with the capital and money markets, and its multiplier effect through consumer spending on housing-related materials like furniture, painting, etc.

“Homeownership often gives citizens a true stake in their communities. After owning a home, many citizens tend naturally to be concerned about provision and protection of public goods in their communities from schools, to clinics, to security, etc. This implies that higher demand for homeownership is likely to boost the contribution of all these sectors to the Gross Domestic Product, thus increasing national wealth.”

The Director, Other Financial Institutions Supervision Department, Central Bank of Nigeria, Alhaji Ahmed Abdullahi, noted that there was no magic cure that could create an effective housing finance system overnight, adding that the basics must be in place before the market could flourish.