The second private mortgage Bank gets green light from the National Bank of Ethiopia to provide financing for the chronic housing problem targeting low income communities.
With an appealing name, prominent business people, set to establish Selam Bank that provides long term housing finance in a bid to contribute their part in filling the huge housing demand in the country.
Betlhem Alemu, the noted entrepreneur and one of the 100 Most Influential African Women in 2019 and owner of Sole Rebels a handcrafted footwear company is one of the few founders. Sara Abera owner of Sara Garment Designers and Manufacturers who design and supply high fashion, ladies dresses and accessories, Zemedeneh Negatu Global Chairman of the Fairfax Africa Fund, Girma Gelaw, owner and general manager of Bamacon Engineering, a reputable construction firm and Amman Fissehazion owner of EBS television are some of the few founders of the mortgage bank.
The founders target to raise up to one and half billion birr and hopes others join their journey.
The first time a fully fledged private mortgage financial firm, Goh Betoch Bank Share Company was launched some months ago with the help of major financial businesses and other players to be an eye breaker in the area.
According to government data, Ethiopia shows the highest annual urban growth rate of 5.3 percent driven by rural-urban migration. The urban population in Ethiopia is projected to reach 37.6 percent by 2050.To this end, increased the demand for housing in cities is said to be crucial issue that should be addressed both by private and government engagement.
The prospects further stated that every year 100,000 houses should be constructed to replace the old and meet the growing demand for new homes.
According to one of the founders the minimum share will be 10,000 birr to ensure inclusive ownership.
An expert who requested anonymity told Capital that the housing scheme has been neglected from the loan scheme until the condo housing project was introduced by the government in 2004, which is fully controlled by the government.
Adding that, the condo housing project is vulnerable to corruption in the construction stage and lottery process besides poor performance in the accomplishment and advocate market based housing schemes.
Selam Mortgage Bank founders believe that most housing projects are neglecting the low income society. For this end they hope to accomplish their endeavor and will start operation soon.