MOFI to launch non-interest housing option, as MREIF disburses single-digit mortgages

…as MREIF disburses single-digit mortgages

The Ministry of Finance Incorporated (MOFI) plans to roll out a shariah-compliant, non-interest version of its flagship housing initiative, the MOFI Real Estate Investment Fund (MREIF), with plans to include Nigerians in the diaspora, as the program accelerates its mortgage disbursements at single-digit interest rates.

The move marks a significant expansion of the federal government’s strategy to address Nigeria’s chronic housing shortage, estimated at 20 million units.

MREIF, a ₦1 trillion fund regulated by the Securities and Exchange Commission (SEC), was established to lower the barriers to homeownership by offering long-tenor mortgages at reduced rates.

According to Armstrong Ume Takang, MOFI’s Chief Executive Officer, the fund has already begun disbursing loans through select financial institutions.

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“Nigerians are already receiving single-digit mortgages through MREIF,” Takang said during a keynote speech at the Africa International Housing Show in Abuja on Thursday.

“We are also working to launch a non-interest financing option to include all Nigerians, particularly those in the diaspora who want to own homes back home.”

MREIF, which recently reduced its interest rate from 12% to 9.75%, aims to create a transformative shift in Nigeria’s housing finance landscape.

The fund leverages private capital and government backing in a public-private partnership (PPP) model designed to ensure long-term sustainability. With ₦250 billion already raised, the fund is currently active across three geopolitical zones, with more financial institutions being onboarded to expand its national reach.

Backed by a AAA rating from Agusto & Co and an AA from Global Credit Ratings (GCR), MREIF operates independently of MOFI, with private sector firms overseeing fund management, financial advisory, legal structuring, and project execution. Among its partners are ARM, VETIVA, Olaniwun Ajayi, and First Bank of Nigeria.

Takang emphasised that the fund’s structure was purpose-built to address the underlying weaknesses in Nigeria’s housing sector, including liquidity constraints, poor corporate governance, and shallow secondary mortgage markets.

“We designed MREIF to hedge against the typical problems—liquidity, governance lapses, limited refinancing,” he said. “This is not just another fund; this is a market-regulated, investment-grade instrument meant to reset the rules.”

Eligible Financial Institutions (EFIs) working with MREIF include top-tier banks such as Access Bank, FCMB, and Stanbic IBTC, as well as mortgage lenders like AG Mortgages and Infinity Trust Mortgage Bank. These institutions serve as conduits for mortgage origination, ensuring that both home-seekers and developers have access to long-term financing options.

In addition to providing consumer mortgages, MREIF also supports the supply side of the housing equation by offering offtake guarantees to qualified developers, a mechanism that assures developers of sales by matching them with pre-approved buyers with mortgage backing.

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By integrating the diaspora into the fund and adding non-interest investment options, MOFI aims to unlock a new pool of capital and meet the growing demand from Nigerians abroad seeking ethical, faith-aligned housing finance.

“This is a public-private partnership that works,” Takang said. “Thanks to President Bola Tinubu’s Renewed Hope Initiative and the support of our partners, we are scaling impact and building a sustainable future for Nigeria’s housing market.”