Nigeria’s Securities and Exchange Commission (SEC) and the Federal Mortgage Bank of Nigeria (FMBN) have announced a strategic collaboration to develop a robust non-interest mortgage ecosystem.
According to a statement by SEC, the partnership is aimed at tackling the Nigerian massive housing deficit and deepening financial inclusion.
The partnership, unveiled at a high-level meeting in Abuja, seeks to create and regulate viable Sharia-compliant financing structures that will enable millions of Nigerians, particularly those excluded from conventional interest-based loans, to access affordable homeownership.
The statement stated that the Director-General of the SEC, Dr Emomotimi Agama, explained that the commission’s role is ensuring the integrity and stability of the proposed financial instruments, and that SEC would provide the necessary regulatory guidance and framework to facilitate the issuance of Sukuk and other non-interest capital market products to fund these mortgages.
“Our collaboration with FMBN is pivotal to unlocking long-term financing for the housing sector,” Agama said. “By creating a clear regulatory pathway for non-interest mortgage-backed securities, we can attract ethical investors, both domestic and international, to channel funds into this critical area. This will create a virtuous cycle of funding, construction, and ownership.”
It added that the Managing Director/Chief Executive Officer of FMBN, Mr Shehu Osidi, said: “For a long time, a substantial number of our citizens have been unable to participate in the National Housing Fund scheme due to the interest-based nature of conventional mortgages. This partnership with the SEC is a strategic response to that gap. We are committed to developing non-interest mortgage products that are not only ethical and inclusive but also financially sustainable.”
Nigeria’s housing deficit is estimated to be over 28 million units, with finance being one of the major barriers to homeownership.
GIK/APA