Pension fund operators are currently exploring ways to use funds under their care to solve housing problems in the country. The move is an apparent response to the clamour for the deployment of accumulated pension savings for the development of infrastructure for the benefit of contributors.

The Managing Director of ARM Pension Managers Limited, Mr. Sadiq Mohammed, confirmed this in an interview last week. He said Pension Fund Administrators (PFAs) are also concerned about what other stakeholders’ complaints and are determined to evolve ways of using pension funds for the development of critical infrastructure in the country.

According to him, the PFAs are currently reviewing how their Retirement Savings Account (RSA) holders could be helped to build or buy their own houses, using part of their pension savings as collateral.

“The industry has come together and is trying to address the issues raised by stakeholders. It has an initiative on housing because there have been complaints around the industry that these funds are not being utilised meaningfully for economic development or to the benefits of the subscribers themselves.

“Therefore, the industry came up with the initiative on how to fund housing or mortgages particularly, so that if you are an RSA holder, you should be able to use some part of your balance as collateral to secure a mortgage,” Mohammed said. “This will be an exclusive product only for RSA holders rather than for everybody,” he stressed.

The ARM Pensions boss also said PFAs are seeking to use this programme, when it finally takes off, to attract, particularly employees of States and Local Governments to embrace contributory pension.

“This could be an incentive for other states that have not complied to try to comply. For example because Lagos State Government has complied, its employees should be able to benefit from this product when it comes on stream, whereas other states that have not complied will not be able to benefit until their state complies,” he said.

In a related development, ARM Pensions said it has several competitive edges over other competitors by virtue of being a member of ARM Group, saying RSA holders with the firm have access to mortgage facilities, a service their colleagues saving with other PFAs may not have.

“Within the group we have a real estate business called ARM Properties Plc, so we are able to offer our clients real estate products such as low income housing at promotional prices when they are available.

“About three years ago we did ADIVA, where two bedrooms flat started at N8.5 million which is a good opportunity for some of our clients to own their houses, starting at promotional prices which other PFAs may not be in the position to offer such advantage,” Mohammed said.

According to him, RSA holders with ARM Pensions have other value addition in the areas of trust and will as well as business advisory services, particularly for retirees seeking to open new businesses to boost their income in retirement.

“Because we are a part of the ARM Group, there are other benefits we offer apart from just pension fund management because in the industry, almost every player offers the same product, pension fund management.

“We provide wills and trusts from within the group for our clients so that they can set up trusts to ensure that all their assets are in a trust and in the event of death, their beneficiaries are able to get those benefits rather than being distributed by all sorts of relatives”, he added.

THISDAY

2013-08-05