Nigerian workers can now use 25 percent of their Retirement Savings Account (RSA) as equity contribution for mortgages.
The National Pension Commission (PenCom) made the announcement in a statement made available to the press.
According to the commission, Nigerian workers can use 25 percent of their Retirement Savings Account as equity contribution toward their mortgage. The commission explained that the approval is in line with Section 89 Sub Section 2 of the Pension Reform Act, 2014.
Both salaried employees and self-employed persons can take advantage of the new service albeit after they have met certain conditions.
Part of the conditions require the applicant (RSA Holder) to be in active employment and must have an offer letter for the property which must be duly signed by the property owner and verified by the mortgage lender.
The Retirement Savings Account (RSA) of the applicant must also be active for at least five years with both the employer and employee making the mandatory contributions.
While any RSA holders with less than three years to retirement are not eligible, couples who are both RSA holders can submit a joint application subject that both individuals satisfy all the requirements.
Meanwhile, Investors King learnt that the news generated mixed feelings among the concerned workers. A number of people commended the new development while some pick hole in it.
Abiodun Bamiduro who commented on the official twitter handle of PenCom (@PenComNig) said ” This is long overdue. Better late than never though. Can you also look into the need of RSA holders who are over 50 years of age to access part of their balance for investment in Agriculture before they retire. Starting after retirement makes it more complicated”. Abiodun concluded.
Another commentator, David Ezennia said “Long awaited good news for developers in the real estate sector”. An elated commentator who goes by the name Proudly Nigeria said ” From Monday, I will storm my PFA to inform them and also meet with my mortgage banker to fashion out how to access the fund”.
The National Pension Commission otherwise known as PenCom was established by the Pension Reform Act 2004, to regulate, supervise and ensure the effective administration of pension matters in Nigeria. PenCom gives licence to Pension Fund Administrators (PFAs) and also oversees pension policy guidelines to protect the interest of the Nigerian workers.
