Pension Commission Approves 26 Commercial Banks As Its Mortgage Lenders

The National Pension Commission has listed 26 commercial banks in Nigeria as its approved mortgage lenders, and three non-interest banks to provide residential and commercial mortgage to workers under the Contributory Pension Scheme to access 25 percent of the Retirement Savings Account (RSA) for the purpose of mortgage.

In September 2022, PenCom approved the issuance and immediate implementation of the guidelines on accessing RSA balance towards payment of equity contribution for residential mortgage by RSA holders.

“The approval is in line with Section 89 (2) of the Pension Reform Act 2014, which allows RSA holders to use a portion of their RSA balance towards payment of equity for residential mortgage,” it stated.

According to the Commission, the guidelines covered pension contributors in active employment, either as a salaried employee or as a self-employed person.

It added that the maximum amount to be withdrawn is 25 per cent of the total mandatory RSA balance as of the date of application, irrespective of the value of equity contribution required by the mortgage lender.

Where 25 percent of a contributor’s RSA balance is not sufficient for payment as equity contribution, it added, RSA holders may utilise the contingency portion of their voluntary contributions, if any.

To qualify as a mortgage lender for the purpose, it stated, the company must be licensed by the CBN, comply with the Contributory Pension Scheme and have valid Pension Clearance Certificate.