, NAIROBI, Kenya, Oct 23 – Housing Finance (HF) on Tuesday signed an agency agreement with Postbank that will enable its customers make deposits and cash withdrawals through the institution’s branches across the country.
Housing Finance Managing Director Frank Ireri said the move will help the firm decentralise the mortgage market from Nairobi to the 47 counties where Postbank has presence.
Ireri said the firm decided to partner with the State owned bank since they were both serving the same market which is medium and the lower income.
“It about utilising what you have invested in and letting others come and pair in it and that is exactly what Postbank has done. The alternative for HF would have been to go out and build 99 branches. Imagine what cost that would be,” said Ireri.
“Our partnership with Postbank will create an optimal channel distribution mix that will reduce costs for the institution and our customers and serve in the medium term,” he said, adding that the public-private mortgage firm is also looking at spreading its products to the county levels especially after the next elections.
Postbank Managing Director Nyambura Koigi said Housing Finance customers do not need to have an account with the bank for them to benefit from the services.
“We are joining a partner which has around 10 outlets, so they are leveraging on what we already have and our outlets are across the country,” said Koigi.
The partnership is in line with the amendments to the Banking Act through the Finance Bill 2009 which allows commercial banks and mortgage financial institutions to appoint agents to conduct banking business on their behalf.
The partnership comes a week after Housing Finance raised Sh5.28 billion against a target of Sh2.9 billion from its second tranche of its Bond Issue to be used for mortgage financing and onward lending to property developers.
“Now that we have the money, we will be able to sell our ideas to our customers easily across the country. Developing housing in the counties is one of our agendas, but as I had said earlier we will give more information on this after general elections,” said Ireri.