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Local authorities’ pension fund provides N$227m in pension-backed home loans

By April 03, 2023 0
Local authorities’ pension fund provides N$227m in pension-backed home loans

The Retirement Fund for Local Authorities and Utility Services (RFLAUN) has provided pension-backed home loans worth N$227 million to 1,300 members in 2022, an official has said.

The Fund said the pension-backed loan, which covers one-third of a member's pension fund credit, is aimed at allowing its members the ability to obtain a home loan.

“One of the most striking achievements of this institution is the quest of alleviating the housing challenge currently being experienced in our country. RFLAUN, through its housing benefit, provides a Pension-Backed Home Loan Scheme to its members. This covers up to a third of a member’s pension fund credit allowing them to access a home loan,” the Director of Regional, Local Government and Traditional Authorities Coordination at the Ministry of Urban and Rural Development, Prisca Anyolo told an RFLAUN anniversary event.

Anyolo urged other local authorities who are not members of RFLAUN to join the Fund in order for their employees to have access to the pension-backed loan scheme.

“I am informed that the value of the loan book currently stands at N$227 million, and so far about 1,300 members have benefitted from this scheme. These are just some of the notable economic and social impacts which the Fund contributes to. We strive to work as a team and collaborate with our stakeholders to achieve our goals. Only through teamwork we can achieve our vision of becoming the leading pension Fund in Namibia,” she said.

This comes as the Fund now has over N$6.6 billion in assets under management, according to RFLAUN’s Principal Executive Officer Dorian Amwaandangi.

“This growth can be attributed to the Fund's commitment to sound financial management, prudent investment strategies, and its focus on meeting the needs of its members,” he said.

Chairperson of the Board of Trustees Gaudentia Krohne said: “as we look to the future, the Board remains committed to promoting good governance and transparency in all our operations, and we will continue to engage with our members and stakeholders to ensure that their voices are heard, and their concerns addressed”.

The Fund was established in 1992 as a Defined Contribution Pension Fund in terms of the Pension Funds Act, No24 of 1956 with the objective to provide retirement and other benefits for employees and former employees, and benefits in the event of their death or being declared disabled.

RFLAUN has 57 local authorities as members.

This comes as the country’s biggest pension fund, the Government Institutions Pension Fund (GIPF), is still moving ahead with plans of launching a Pension-Backed Home Loan scheme that will allow members to use their pension as collateral to buy or renovate their properties.

The planned loan scheme, which will have an initial allocation of a billion Namibia dollars, will also allow funding for the construction of property, even in rural areas.

Namibia needs at least half a million new homes to meet rising demand, but 90% of Namibian households are not eligible for mortgages, according to the World Economic Forum. 

 

 

 

 

 

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Last modified on Tuesday, 04 April 2023 19:12
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