IFC to augment country’s housing sector

• Rejuvenation of BHR on the cards NYARUGENGE - The International Finance Corporation (IFC), a member of the World Bank group, and theGovernment Monday evening initiated a mortgage lending programme to prop up the housing sector. A much valued Memorandum of Understanding (MoU) to this effect was signed by Finance Minister James Musoni and the new IFC Director for East and Central Africa, Jean Philippe Prosper, at the ministry’s boardroom. “The government appreciates the commitment made by the IFC,” Musoni said, and also stressed that the deal – Rwanda Mortgage Lending Program (RLMP) – was “part of the housing reform” in the country. “Housing reform is a key component of the financial sector development plan which seeks to widen and deepen the financial sector according to Rwanda’s Vision 2020,” he said. Musoni further explained that the purpose of the MoU was to outline the scope of cooperation and the next steps in order to develop a realistic and sustainable mortgage market. “The housing finance component seeks to substantially expand the financing and supply of affordable housing,” he said, pointing out that “such houses are in high demand by the population.” Prosper also acknowledged that “the housing challenge in Rwanda is huge.” He mentioned lack of affordable houses, the need to improve the legal and regulatory framework and lack of access to long term funds as some of the challenges. “Rwanda will benefit immensely from IFC’s involvement and worldwide accumulated experience in mortgage market development,’’ Prosper said shortly before summing up the history of IFC and government cooperation in the housing scheme. “Within this process, the Rwandan government considered a broader mandate for the Banque de l’Habitat du Rwanda (BHP),” he explained. “A financial sector steering committee was set up and it was agreed to convert BHR into a secondary mortgage market provider.” The design of the pilot funding programme was done last week and discussions with the Ministry of Finance and Economic Planning (MINECOFIN), National Social Security Fund (NSSF), BHR and lenders to implement it have been held. BHR will offer long term funds to mortgage originators to refinance their mortgage loans. Ends