Cabinet secretary Emilia Mkusa and Government Institutions Pension Fund (GIPF) chief executive Martin Inkumbi on Wednesday signed an agreement to implement the Pension-Backed Home Loan Scheme (PBHLS).
GIPF marketing and stakeholder engagement general manager Edwin Tjiramba on Wednesday highlighted that the home loan scheme enables qualifying GIPF members to access a portion of their retirement savings for housing purposes.
“The PBHLS will allow a qualifying GIPF member to borrow up to one-third of their pension benefit and repayable at a rate of repo plus 2.5%, for the purchase of a home or land, construction of new houses, home improvements or renovations to existing property, in urban and rural areas, proclaimed and unproclaimed areas across the country,” Tjiramba said.
This means if a pensioner’s benefit is N$500 000 and they qualify for the PHBLS, they will be allowed to borrow a total of N$167 000 from the sum.
Mkusa said the commencement of the PBHLS will enable qualifying civil servants to secure residential properties, and have access to financial security, stability and peace of mind, knowing they are providing a safe place for their families and future generations.
Inkumbi noted that the execution of the agreement marks the official initiation of the PBHLS and the administrators will have a four-month period to conclude all necessary modalities, paving the way for members to start borrowing on 12 January 2026.
Tjiramba underscored that the collateral structure of the PBHL differs significantly from a traditional mortgage. While a standard mortgage from a bank uses the property as collateral, the PBHL is secured against the borrower’s pension fund, specifically, a portion of the member’s pension credit or resignation benefit capped at 33.3% will serve as the loan guarantee.
Inkumbi clarified that the PBHLS is designed in a manner that active members’ retirement will not be negatively impacted at the time of retirement, as all outstanding loan amounts will have been repaid by the time retirement is reached by the member.
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