BSP says 597 under home ownership scheme

BANK South Pacific currently has 597 customers who have already been funded by its First Home Ownership Scheme (FHOS) loan programme, says deputy general manager Kili Tambua.
“We have a book balance of over K200 million, funded out to the customers, and the interest is still growing,” Tambua said during the PNG Real Estate Show recently.
Tambua said they encountered firsthand some challenges with the FHOS loan programme, mainly on accessibility of service land.
FHOS is a joint initiative of BSP and PNG Government, under which qualified citizens can avail of a loan to buy their first homes.
Aimed at helping families, the programme loans K200,000 to K400,000 to qualified applicants for buying a newly-built home or to erect a new home on Government-owned land.
“At four per cent interest rate and 10 per cent equity, that’s the cheapest at the moment, compared to what other commercial banks are doing at the moment,” Tambua said.
He said the programme was going well so far.
“We have seen rapid growth in the market for FHOS,” Tambua said.
“This is largely driven by the LNG construction phase and also accelerated by the product we have developed together with the Government.”
Tambua said the challenges facing BSP were not unique to the bank.
They are also being encountered by other banks and financial institutions who are working with the real estate industry.
Tambua said accessibility of land services was compounded by the fact that about 97 per cent of land in PNG was under customary ownership, while 3 per cent had been delineated to the State.
Another challenge identified by Tambua was lack of access to water, power, road and sewerage.