Octagon Africa, a regional financial services provider has signed a Sh100 billion deal with National Bank (NBK) enabling the lender to be the custodians of its affordable houses project being undertaken by Costa Homes.
Group CEO Fred Waswa said under the model, Octagon Africa, which also offers pension services, will extend administration services through its Octagon Pension Administration System.
He said a buyer seeking to buy property from Costa Homes will remit payments to a custodial account at NBK and Octagon will provide real-time information access with superior administrative capability through online self-service portals.
“It is only when the developer has completed the house and handed over the keys that the money will be transferred from the custodial account to the developer,” Waswa said.
The arrangement is intended to assure clients looking to buy and own homes of the safety of their money, he added.
Paul Russo NBK managing director said the bank is committed to ensuring the home-ownership dream transcends to the middle to low-income households through a guaranteed system that protects the hard-earned money of our customers.
The new Retirement Benefits Mortgage Loans Amendment Regulations, 2020, allows members of pension schemes to use up to 40 per cent of their savings to buy a residential house.