Lahja Nashuuta
The ministry of finance has endorsed the use of pension savings as collateral for aquiring home loans.
This is part of government efforts to address housing challenges among public servants.
Finance minister Ericah Shafudah announced the approval of the Pension-Backed Home Loan (PBHL) scheme, developed in collaboration with the Namibia Financial Institutions Supervisory Authority (Namfisa) and the Government Institutions Pension Fund (GIPF). The initiative is spearheaded by the Office of the Prime Minister.
“The scheme is aimed at improving access to affordable housing, especially for civil servants who are often excluded from traditional mortgage financing due to income limitations or lack of collateral,” Shafudah said.
She said the scheme allows GIPF members across both proclaimed and unproclaimed areas, to use a portion of their pension savings as collateral.
“The loan can be used to buy land or residential property, build or renovate a home, settle an existing mortgage, or improve basic living conditions,” she announced.
Shafudah noted that the initiative is supported by the Pension Funds Act of 1956, which permits loans for housing secured against pension fund assets.
“We are finalising administrative processes with GIPF and payroll systems to ensure the rollout is smooth. Detailed information on who qualifies, how to apply, and the loan terms will be shared with civil servants shortly,” she added.
To ensure affordability, Shafundah said the interest rate has been set at the Bank of Namibia’s repo rate plus 2.5%.
The finance minister emphasised that the right to adequate shelter is a basic human right and expressed hope that the scheme will make a real difference in the lives of many.
“Owning a home provides dignity and security. This scheme empowers civil servants to invest in their future while making housing more accessible,” said Shafudah.
Shafudah urged all beneficiaries to practice responsible borrowing and financial planning, and thanked all partners involved in making the scheme a reality.