Nigeria is taking a significant step toward reducing its housing deficit as the Securities and Exchange Commission (SEC) and the Federal Mortgage Bank of Nigeria (FMBN) begin work on a new Non-Interest Mortgage (NIM) framework designed to widen access to affordable housing for millions of citizens.
Strategic collaboration to deepen financial inclusion
The initiative, unveiled after a high-level meeting in Abuja on Friday, aims to establish a robust ecosystem for Sharia-compliant mortgages. It targets Nigerians who have long been excluded from conventional interest-based financing, particularly those seeking ethical and religiously compliant homeownership options.
Nigeria’s housing deficit—currently estimated at over 28 million units—has been worsened by a lack of accessible and affordable mortgage products. The proposed non-interest model is being positioned as a major tool for bridging this longstanding gap.
SEC to guide non-interest capital market instruments
Emomotimi Agama, Director-General of the SEC, said the Commission will provide the regulatory foundation to support the issuance of Sukuk and other non-interest capital market instruments that can finance mortgage development. He described the collaboration as essential to unlocking long-term housing finance.
According to Agama, establishing a clear regulatory pathway for non-interest, mortgage-backed securities will attract ethical investors at home and abroad. This, he said, will create a sustainable cycle of funding, construction, and homeownership across the country.
FMBN seeks inclusive mortgage products
FMBN’s Managing Director/Chief Executive, Shehu Osidi, emphasised that the partnership addresses a persistent gap in the National Housing Fund (NHF) scheme. Many eligible Nigerians, he noted, have avoided the scheme because of the interest-based nature of available mortgage products.
Osidi said the Bank is committed to developing mortgage options that respect ethical considerations, promote inclusion, and remain financially viable over the long term. He described the collaboration with SEC as a strategic step toward delivering affordable housing solutions nationwide.
Experts describe initiative as long overdue
Housing finance expert, Ebilate McYoroki, welcomed the development, calling it a transformative policy shift. He said the framework could draw in a large segment of potential homeowners and investors who were previously sidelined.
McYoroki added that successful implementation of the non-interest framework could significantly boost housing delivery, stimulate construction activities, and create new employment opportunities.
Exploring non-interest mortgage models
The SEC–FMBN partnership is reviewing several Sharia-compliant models designed to promote asset-backed, interest-free home financing.
These include the Musharakah diminishing partnership structure, the Ijara lease-to-own model, and the Murabaha cost-plus sale arrangement. Each model is built on shared risk, transparency, and equitable returns, making them suitable alternatives to conventional interest-driven mortgages.
Potential impact on Nigeria’s housing sector
If implemented effectively, the non-interest mortgage framework is expected to reduce the housing deficit, empower low- and middle-income earners, and foster greater financial inclusion. The initiative also has the potential to energise the construction industry, strengthen investor confidence, and support broader economic growth
