National Housing Fund:Subscribers Blame FMB For Low Awareness

Poor housing• Over 4Million Subscribers Remit N2.4b Monthly
• FMB Declines To Disclose Figures 

THE National Housing Fund was established in 1992 by the Federal Government in response to the acute housing deficit, as alerted then by the United Nations. The International body had put the housing deficit at 17 million units. It also reported that rent in most Nigerian cities was about 60 per cent of average workers disposable income, higher than between 20 and 30 per cent it recommended.

To address the shortage, as observed by the U.N, the Federal Government came up with a lot of measures as remedy, including establishing the National Housing Fund to provide a pool of funds, from which Nigerians could borrow to build, buy or renovate their homes at six per cent interest and payable in 25 years.

But 23 years after, the National Housing Fund is still very unpopular among Nigerians. Even workers, who are contributing to the fund, through monthly deduction from their salaries, don’t seem to know the purpose of the fund and where deductions are stacked. The Federal Mortgage Bank, that is warehousing deductions from workers nationwide for effective application, is keeping mute, fuelling speculations that the fund is a scam.

Many Nigerians, who spoke on the fund, said they have their money trapped in the fund, into which they have been contributing about two per cent of their monthly income. Daniel Jacob, a top official of the Nigerian Maritime Administration and Safety Agency painted a state of confusion when he narrated his ordeal with the fund.

‘‘I once worked with a bank for eight years, and throughout, they deducted National Housing Fund from my salary. But I had an issue with them when I applied for loan to build a house.

They told me they don’t have my records as a contributor. When I eventually left the bank and wanted to consolidate my account into where I am working now, they said I have no record. Since I came here, I have been contributing to the fund and I am afraid that they don’t tell me again that I have no record.

I know how to access the fund. The truth is that if you apply, it will take you forever to get your application granted, unless you know somebody at the Federal Mortgage Bank,” he said An Assistant General Manager (AGM) with the Nigerian Ports Authority, who preferred to remain anonymous, said he kept on contributing to the fund without knowing how to ‘‘derive the benefits.

” ‘‘I am a regular contributor to the fund because my organisation is making direct deduction for my salary every month, for onward transfer to the fund. But I don’t know where the fund is domiciled, but I know it is under the management of the Federal Government.

Narrating his ordeal under the fund, he said: ‘‘two years ago, somebody collected my passbook with promises that he would help me process a loan from the fund managers. He gave me Federal Mortgage Bank forms to fill and left. Since that time, I have not seen him and he did not return my passbook.

I don’t know what they are doing with the fund. Some people at NPA, who contributed, came back, after their retirement, to ask for refund, but it should not be so. The money should be used to build houses. I am a contributor and I don’t know how to access the fund for the purpose of house ownership. I am sure some people are just enriching themselves with people’s contribution, because I have not seen a contributor who benefited before.”

To Oluranti Olomola, a civil servant at the Federal Capital Territory, the Federal Mortgage Bank should be blamed for the lack of information on the Federal Housing Fund scheme. He had a Telephone conversation with The Guardian on the issue. ‘‘To me, those who are complaining that they don’t know anything about the fund and they have been contributing over 23 years, should blame the Federal Mortgage Bank that is managing the fund.

I am a contributor, and I have not had any need to access the fund. But I have two friends, who have benefited and they have a home each now at Gwagalada. It was the fund that assisted them to do that. I know at least one person who got refund of his contribution as he was retiring. So the fund is real and it is helping people. There is no fraud, but the way they are managing it is making people to have this impression.

They need to come out to educate people, especially on how to benefit. They need to tell people what they have been doing with the fund. If they do that, more Nigerians will volunteer to be part of the fund.” Richard Peter, a civil servant in Lagos said, “ when it first kicked off in my own organisation, people could not access it as the process was tedious, so a lot of people just assumed it was a means of extortion. So a lot of us withdrew from the scheme.

Now, the cooperative has taken charge of it and only those who participated in the land scheme with the cooperative can access the loan, but the statutory fund is still being deducted from everyone’s salary, whether you participated in the land scheme or not. He therefore, advised the government to show commitment to their vision, by making “the process credible to remove speculations relating to extortion.”

The Chairman of Good Shepherd Homes, Sunday Olatunji said, “Government has a role to play in strengthening the institution. The scheme has become unattractive to people because the bank has been poorly understood, poorly publicized, coupled with low patronage and poor implementation.”


Two years ago, somebody collected my passbook with promises that he would help me process a loan from the fund managers. He gave me Federal Mortgage Bank forms to fill and left. Since that time, I have not seen him and he did not return my passbook. I don’t know what they are doing with the fund. Some people at NPA, who contributed, came back, after their retirement, to ask for refund, but it should not be so. The money should be used to build houses

He said the institution needed a credible process, experienced management that would make it to function. He also advised FMBN to showcase its activities relating to the fund and to make the process easier without necessarily profiting at the expense of the people.

The Federal Mortgage Bank has however defended itself, saying ignorance among contributors was responsible for their inability to access their entitlements. It said it has facilitated thousands of housing loan portfolios and refund.

The spokesman of the Federal Mortgage Bank, Mr. Lawal Isa declined request on the total contribution to the fund since its inception. He also refused to give figures relating to the total number of beneficiaries of the fund since it was put in place 23 years ago. ‘‘The bank operates the National Housing Fund individual loan window through Primary Mortgage Institutions (PMIS), the estate development loan window and special product loan window.

These are channels through which the fund can be accessed. The refund of contributions is ongoing for the retired, incapacitated and deceased through their next of kin. Certainly not every contributor can benefit without applying through any of the windows,” he said. Towards the end of last year, sources said monthly contribution from over four million subscribers to the scheme increased from N700 million to N2.4 billion monthly, a 300 per cent increase.

The increase was attributed to the automation of the banks operation and the introduction of e-collection platform by the fund managers. Sources said the fund hits N134 billion during the same period, although N106 billion was contributed to the fund at the end of March 2013, from about four million workers nationwide.

According to reports, no fewer than 74,000 eligible contributors have so far benefited from the scheme. Estimated refund from the fund was put at N1.7 billion.

A breakdown of the figures showed that at least N40 billion was disbursed by the Apex Mortgage bank to primary Mortgage institutions, to finance housing for 22,000 contributors, while N60 billion was granted as Estate Development loan to some private developers, states owned housing corporations and Federal Housing Authority for the construction of several thousands of housing units nationwide.

According to the Head, Special product group of the Federal Mortgage Bank, Shehu Usman, the fund also accommodate Nigerians from informal sectors. These are Nigerians, who are non-salary earners, but joined the National Housing Fund through cooperative to avail them the opportunity of becoming proud house owners.

He said the real contributors to the fund; the salary earners, who subscribed to it could apply for loan to renovate their existing home. It is called rent-to-own mortgage loan.

Usman explained that the home renovation loan would afford Nigerians an opportunity to access mortgage loans for renovation and improvement of their existing homes.

It was designed for Nigerians, who are contributors to the fund who desire to renovate or improve on existing property, while the rent-to-own mortgage is referred to as a unique financing agreement, whereby a landlord agrees to collect monthly rent payment from a tenant for a specific period of time, after which the landlord transfers the ownership of the property to the tenant.

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