…Unveils Non-Interest Mortgage Scheme in Kano

As part of efforts to reduce the acute housing deficit put at 15 million units in the country, the Federal Government has unveiled a non-interest housing finance scheme designed to expand homeownership opportunities for millions of low-income earners across the country.

Besides, the government disclosed plans to increase mortgage disbursements through the Federal Mortgage Bank of Nigeria (FMBN) to 5,000 annually by 2028, as part of sweeping reforms aimed at addressing the country’s deficit.

Minister of Housing and Urban Development, Engr. Dr. Muttaqha Rabe Darma, disclosed during the unveiling Tuesday in Kano, maintained the new product is designed for informal-sector workers and citizens.

The Minister was quick to disabuse any reservation on the non-interest product and urged Nigerians to embrace what he described as an easy way to own a house rather than ascribing religious coloration to the new mortgage facility.

Dr. Drama explained that the initiative would enable eligible Nigerians to acquire homes through a structured rental arrangement without paying conventional interest on mortgage loans.

According to him, the non-interest product would enable beneficiaries to occupy their preferred houses, make agreed rental payments over a specified period and eventually assume full ownership upon completion of their financial obligations.

He said the Federal Government was determined to remove longstanding financial and institutional barriers preventing millions of Nigerians from becoming homeowners.

He expressed concern that despite having more than six million contributors to the National Housing Fund, the Federal Mortgage Bank had historically processed fewer than 500 individual mortgages annually.

“We are not here to add one more product to a shelf. We are here to open another door, so that no Nigerian has to choose between the desire to own a home and deeply held financial or ethical convictions,” the Minister declared.

He disclosed that the policy mandates FMBN to disburse at least 40 per cent of annual NHF collections as mortgages, while increasing its maximum loan ceiling from N50 million to N85 million.

He said the Federal Government was equally targeting an increase in NHF contributors from six million to 10 million by 2028 through partnerships with trade unions, cooperative societies, employers and Nigerians in the diaspora.

The Managing Director, Federal Mortgage Bank of Nigeria (FMBN) Shehu Usman Osidi said the new product, known as Ijarah Muntahia Bittamleek, or Lease-to-Own, allows eligible contributors to the National Housing Fund (NHF) to acquire houses through a structured rental arrangement, with ownership transferred upon fulfilment of agreed contractual obligations.

Osidi explained that the initiative was not restricted to Muslims or residents of northern Nigeria but was available to eligible NHF contributors nationwide, irrespective of religious affiliation.

According to FMBN, the product represents another major intervention in the country’s housing finance sector, following the introduction of its Diaspora NHF Mortgage Loan in August 2026.

The bank maintained that Nigeria’s housing finance system must evolve to accommodate the diverse financial circumstances, cultural values and religious convictions of its citizens.

“For some Nigerians, the conventional interest-based mortgage model does not align with their personal convictions. Others face barriers arising from affordability, limited access to appropriate housing finance options or a lack of confidence in the available financing arrangements,” he said.

The bank expressed optimism that the introduction of non-interest mortgage financing would encourage more Nigerians to participate in the National Housing Fund and stimulate investment in the country’s housing sector.

The bank also acknowledged the contributions of the Central Bank of Nigeria, its Board of Directors, Advisory Committee of Experts and other stakeholders involved in developing the new mortgage product.