According to Olumide Oyetan, President of the Pension Fund Operators Association of Nigeria (PenOp), the National Pension Commission’s (PENCOM) new pension residential policy is a catalyst and may encourage growth in other industries.
In a statement released in Lagos, Oyetan stated that the policy would benefit the building materials and mortgage finance industries in addition to the construction value chain.
As pension managers, he claimed that they are confident that it will significantly increase the number of jobs for skilled tradespeople and blue-collar laborers involved in the construction value chain, as well as further expand the wealth management and financial planning sectors.
Additionally, he claimed that RSA holders will want to reach the RSA balance because they want to acquire a house.
He stressed that they were aware that the process of actualizing the portion of the Pension Reform Act on a mortgage has gone through many iterations and stakeholder engagement and that they were happy that it had been released.
He pointed out that while they realize that there might be some initial teething problems, they are excited and are primed to partner with the commission, RSA holders, and other stakeholders to ensure that the policy actualizes the reason it was set up.
Oyetan, who is also the Chief Executive Officer, Stanbic IBTC PFA, added that the homeownership ratio and first-time home buyer statistics are low and they believe that the policy will help to improve this and also provide increased benefits to RSA holders in the immediate future.
He said: “Pension operators commend PenCom for the recent release of the guidelines that brings into effect the use of a portion of one’s Retirement Savings Account (RSA) as equity contribution for obtaining residential mortgages.
“The provision for this had been part of the amendments that occurred when the Pension Reform act was amended in 2014.”
