Kenyans Earning Below Ksh 150,000 Per Month To Get House Loans

By Soko Directory Team / August 11, 2020 | 1:45 pm



Investment young adults

By Getrude Matayo

As covid-19 continues to sweep across the country, from next month, Kenyans earning 150,000 shillings per month expected to start getting house loans from local banks and SACCOs at an annual subsidized interest of seven percent or nearly half the prevailing market price.

The lower home loans are the product of the newly established Kenya Mortgage Refinance (KMRC), a treasury backed lender, which offers banks and SACCOs cash for onward lending to households.

According to Chief executive of KMRC, Johnstone Oltetia, the refinancing firm expects to start lending before the end of the third quarter, which closes on September 30.

The Kenya Mortgage Refinance will lend money to financial institutions at an annual interest of five percent enabling them to write home loans at seven percent lower than an average market rate of 11.95 percent cheaper.

Mr. Johnstone Oltetia said the firm operation permit from the Central Bank of Kenya will be ready this month, adding the KMRC is ready to start after the regulator complete vetting its key staff and premises.

The government owns a 25 percent stake in KMRC, with the rest of the shares held by banks, SACCOs and microfinance institutions. Its board of directors has been in the place since July last year.

KEMRC has so far mobilized nearly 40 billion shillings, including 2.2 billion shillings in equity capital 25 billion shillings committed by the World Bank, and 10 billion from African Development Bank.

Mr. Oltetia said The CBK has approved the KMRC to prepare as a mortgage refinancing institution in principle but the only thing that remains is to have a license

Mortgage firms have shied away from writing housing loans, mainly b due to a lack of long-term deposits in the industry to match them

A few weeks ago, Shelter and International Finance Corporation, the World Bank’s private financing arm, became the newest shareholder of KMRC Shelter Afrique paid 200 million shillings





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