This archive report was first published on 18 July 2019.
On July 18, 2019, President Uhuru Kenyatta launched the Kenya Mortgage Refinancing Company (KMRC), a State-backed firm aimed at boosting access to cheaper mortgage through long-term finance for home loans. However, the company's take-off has been delayed due to a licence hitch.
The Central Bank of Kenya (CBK) has yet to offer KMRC a licence, more than two months after its launch. This has caused a delay in the company's operations, despite having a $250 million (Sh25 billion) loan from the World Bank and another $100.51 million (Sh10 billion) from the African Development Bank (AfDB) to kick off mortgage refinancing.
According to a Treasury official, the company needs to show proof of the CBK permit before allowing the use of the billions, which will lead to mortgage rates below market rate. The official stated, 'We have to show the World Bank and AfDB the regulations and CBK licence to be able to draw the funds.'
The KMRC targets to lend at below 10 per cent, aiming to provide 500,000 houses in five years. The non-deposit taking KMRC is 80 percent owned by banks and saccos, and the rest is held by the State.
