The Government Institutions Pension Fund (GIPF) says it is ready to roll out Pension Backed Home Loans to help workers secure houses.
The new scheme is expected to help Namibia navigate its housing crisis, where the country needs at least half a million new homes to meet rising demand, but 90% of Namibian households are not eligible for mortgages, according to the World Economic Forum.
GIPF Chief Executive Officer David Nuyoma told The Brief that only two things are standing between the imminent launch of the scheme – deduction codes from the Ministry of Finance and the signing of a Memorandum of Understanding (MoU) with the government.
Nuyoma said once the process is concluded, the fund will fully implement the life changing scheme, which will see many employees securing houses.
“The board has already approved the implementation as soon as possible, but the enactment needs to be harmonised and agreed upon with the employer, which is governed through the Office of the Prime Minister and so far, we got indications that the government is happy with the programme and facility, thus it is well on the cards. On our side, we are ready to implement, as soon as the stakeholders are informed accordingly and consent,” he said.
Nuyoma noted that GIPF is required to observe prudential requirements such as the usage of a member’s third of their savings so that they do not compromise their pension payout when they reach retirement.
“So, all these details will be made clearer very soon to the public when we launch, for now there might be some amendments here and there before the operationalisation,” he said.
The pension home loan scheme will allow GIPF members to use their pensions as collateral to purchase a house or carry out renovations.
The GIPF, the country’s largest pension fund, said the planned loan scheme will also allow funding for the construction of property even in the rural areas.
The proposed scheme comes after an outcry from civil servants and other GIPF participating employers who were failing to secure housing loans.
The GIPF, which has assets worth N$148 billion, serviced 5,127 plots, constructed 3,721 housing units and financed 2,468 housing loans in the last financial year.
GIPF is a statutory pension fund which provides guaranteed pension and related benefits to over 101 027 civil servants, and employees of participating employers in Namibia.
