Someone asked me how mortgage banks can find effective expression in financial inclusion drive. These were my responses:
- Understand the features of the target market
- Develop appropriate Products
- Seek right Partnerships
- Seek right Technology
Obviously, the target market in financial inclusion is in two phases considering financial capacity: The Poor, and the Active Poor (Under-served-Active Poor, Excluded-Active Poor).
Government Social Intervention Programs usually focus on the poor for empowerment; those who needed such interventions the most are the Homeless Children, Sick, Widows, Handicapped-unskilled and Situational poor people. These people will be financially included even if it is against their will while benefiting from the social programs.
The active poor are usually healthy, may be skilled, semi-skilled or unskilled and at least will be engaged in one activity or the other to make ends meets. This is where we have the largest market (Under-served and Excluded) for financial inclusion.
One of the major needs, this target market does not joke with is shelter, no matter how small it is with different levels of comfort. Micro-housing Plan will fix this need.
The Federal Mortgage Loan of N15,000,000 (fifteen million naira) per citizen for instance is usually perceived as- ‘‘it is for the elites’’ because such amount sounds scary to most of them.
A larger percentage of them based on demography prefer to live close together in ‘’face me I face you’’ and other related arrangements.
Mortgage products that will embraced must be designed in a manner that will make it acceptable and repayment of such may not exceed N300 per day for 30 years.
The product should not be designed for individual but for family or group that will share liabilities among themselves.
We can imagine building ‘’a room self-contained’’ as popularly called, and giving it out as mortgage for daily repayment of N300 for 30 years to 50 million people. Largely, the mortgage banks will become busier with different kinds of activities such as creating/partnering with agents across the country to deliver required signed-on and repayments services through carefully selected technology channels. A viable business case can be developed to show more light into various activities that will be involved.
As people become financially stable, they will make a choice of moving to more comfortable apartment as they wish as long as the repayments continue to run.
Finally, the life you will live and enjoy most is the life that you designed for yourself and not the life other people designed for you.