(Ecofin Agency) - The Federal Government of Nigeria has secured a $300 million World Bank facility to support a new housing scheme designed to improve access to finance for housing projects in the country.
Known as the National Housing Finance Programme (NHFP), the scheme is a Public Private Partnership (PPP) aimed at improving low-income earners’ access to own personal homes with a guaranteed credit from the CBN.
According to the CBN deputy director, Other Financial Institutions, Adedeji Adesemoye, the World Bank loan is an International Development Association (IDA) facility which has a repayment period of 40 years. It would be managed by nine Micro-Finance Institutions (MFI) across the country.
“It is designed to de-risk the sector through private partnership. We had opportunity to access an IDA facility which is a 40 years loan designed to assist in four different components. But for institution to finance this kind of asset creation, we need to have institutions that will have access to a long term debt capital. So today, we are providing Nigerian Mortgage Refinance Company ( NMRC ) with a long term tier two capital. The total loan we got is $300m but $250m will be given to NMRC. It’s a tier two capital, i.e a long term debt with almost less than one per cent commission and interest charge,” Adesemoye said.
The Deputy Director added that two tranches of the loan had already been disbursed.