Kenyans Earning Less than KSh 150k Eligible for KSh 549 Million Mortgage Loans from Co-op Bank
The Kenya Mortgage Refinance Company (KMRC) has given Co-operative Bank a KSh 549.8 million for onward lending. Co-operative Bank will lend the amount to home buyers, thus boosting its mortgage availability and loan accounts Pay attention.
The bank received a KSh 549.8 million loan from KMRC in June 2021 to finance affordable housing mortgage loans. Under the deal, Cooperative bank will lend the money to home buyers earning less than KSh 150,000 per month at single-digit interest rates.
The lender will see mortgage loans increase to KSh 749.8 million upon lending the whole amount received to home buyers.
The move by the lender will boost mortgage availability and loan accounts, which recorded a 3.7% decline to 26,971 in December 2020 from 27,993 in December 2019. The loan from KMRC represents 1.3% of the bank’s total borrowed funds worth KSh 42.9 billion as of December 2021.
The deal between the two parties would increase mortgage uptake and boost homeownership rates in Kenya, which currently stands at 21.3% in urban areas as of 2020, compared to other African countries such as South Africa and Ghana at 53.0% and 47.2%.
The move is also in addition to KMRC’s aggressive efforts to provide affordable home loans to Kenyans through various strategies such as debt sourcing and corporate bonds.