Mortgage sector: How national mortgage registry will shift paradigms, change narratives | Prestige Real Estate News

By Chuka Uroko

The story of the mortgage sector in Nigeria is that of development in slow motion. It is a story that hardly excites interest as, over the years, it has remained a fledgling amid an expanding population and fast-paced urbanization.

Elsewhere, especially in developed economies, the housing and mortgage sector is a key indicator of an economy’s growth, development or underdevelopment. The sector plays a crucial role in meeting the needs of a country’s population by facilitating easy access to loans and promoting financial inclusion.

Economists surmise that a robust mortgage system supports individual homeownership and stimulates economic activities by creating jobs in construction, real estate and related industries.

But in Nigeria, despite the importance of the mortgage sector to the economy, the sector has not been playing its role because it is plagued by inefficiencies, a lack of transparency and complex bureaucratic hurdles that make homeownership an uphill battle for millions of citizens.

A housing deficit exceeding 20 million units and a mortgage penetration that is below 1 percent of GDP, significantly lower than rates in other emerging markets like South Africa (30 percent) and Kenya (5percent), underscore the urgent need for a paradigm shift and a change in narratives in this sector.

The slow growth arising from low investment in this sector has been blamed on the absence of a centralized, verifiable mortgage record system that has exacerbated other challenges, leading to fraudulent property transactions, multiple claims on properties and protracted delays in mortgage approvals.

For decades, prospective homeowners have faced long approval timelines, difficulty in verifying property ownership and inconsistent lending practices from financial institutions. This fragmented system has not only hindered growth in Nigeria’s real estate and mortgage banking industries, but also made affordable housing finance inaccessible to the majority of the population.

Worried by these anomalies in the sector, the Federal Mortgage Bank of Nigeria (FMBN), the country’s apex mortgage institution, has evolved an initiative that will not only catalyze the paradigm shift or change the narrative, but also bridge the identified gaps and modernize the mortgage sector.

The new initiative, according to officials of the bank, is known as National Mortgage Registry (NMR). It is designed as a centralized, digital database that will record all mortgage transactions in real-time, providing a single source of truth for stakeholders.

“This initiative, which represents a paradigm shift in Nigeria’s mortgage sector, aligns with the priorities of President Bola Tinubu and the ministerial deliverables of the Ahmed Dangiwa-led Ministry of Housing and Urban Development,” Shehu Osidi, FMBN’s managing director/chief executive, explained.

Osidi described NMR as a “digital game changer” and an innovative digital repository that will enable financial institutions, government agencies, and homebuyers to verify property titles, track mortgage status, and prevent fraudulent transactions with unprecedented ease.

The NMR’s primary goal is to streamline mortgage processing, reduce risks for lenders, and expand homeownership opportunities for Nigerians across all income levels. This is particularly significant for those in the informal sector, who have historically been excluded from formal mortgage financing due to a lack of verifiable income documentation.

“By leveraging technology, FMBN is entrenching a culture of inclusivity in mortgage financing, ensuring that no Nigerian is left behind in the quest for homeownership,” Osidi assured.

According to him, NMR is not just a technological upgrade, but also a foundational tool for economic empowerment, pointing out that, by digitizing mortgage records, Nigeria is joining the ranks of advanced economies where digital registries have proven to be catalysts for housing market growth.

He cited countries like the United Kingdom and Singapore that have long benefited from centralized property registries, which have enhanced transparency, reduced fraud, and attracted foreign investment. “The NMR aims to replicate these successes in Nigeria, setting a new standard for mortgage banking in Africa,” he said.

As an innovative product, NMR comes with key benefits, including enhanced transparency and accountability; faster and more efficient mortgage processing; reduced lender risk and expanded mortgage financing, and support for data-driven policy-making.

Other benefits are attracting foreign direct investment (FDI) and private sector participation; expanded mortgage access to the informal sector, and laying the groundwork for future technological innovations.

Osidi assures that a digital, centralized mortgage registry will ensure that all property transactions are properly recorded and easily accessible, significantly reducing fraud and disputes. The NMR will eliminate the rampant issue of multiple claims on a single property, a problem that has led to countless legal battles and eroded trust in the mortgage system.

It is expected that with verifiable mortgage records, financial institutions, developers, and homebuyers can engage in transactions with confidence, knowing that the data is accurate and up-to-date.

“This transparency is expected to have a ripple effect on the broader economy as it will reduce the risk of non-performing loans (NPLs), which have been a major concern for Nigerian banks, including FMBN,” Osidi said, explaining that, by providing lenders with reliable data, the NMR will enable them to make informed decisions, thereby improving the overall health of the financial sector.

If homebuyers are not taking mortgage loan in Nigeria, it is not only because of its high cost, but also because of the process of getting the loan which is long and tortuous. Many believe that The current mortgage system in the country is notoriously slow and bureaucratic, with approval timelines often stretching into months or even years.

But the NMR will address this by automating verification processes and reducing reliance on paperwork. Banks and mortgage institutions will have access to real-time data, enabling them to make quicker lending decisions.

This efficiency, it is hoped, will translate into lower administrative costs for financial institutions, savings that can be passed on to borrowers in the form of reduced mortgage interest rates. For homebuyers, this means faster access to funds and a smoother path to homeownership.

“The NMR will also integrate with existing land registry systems, further streamlining the process and eliminating redundancies,” Osidi assures.

The managing director said that NMR is just one out of FMBN’s numerous comprehensive digital transformation strategies, explaining that the bank has broader digital transformation agenda, including the deployment of a Core Banking Application, set to automate mortgage processing and improve service delivery, reducing human error and operational inefficiencies.

Osidi reasoned that this could also pave the way for virtual property inspections, by leveraging drones and 3D imaging technology, enabling the bank to reduce the need for physical site visits, saving time and resources.

“FMBN is also looking to collaborate with fintech companies. By partnering with fintech firms, the bank will integrate smart lending solutions into the mortgage system, further enhancing accessibility and efficiency,” he said, adding that “all these reforms underscore FMBN’s commitment to leveraging technology to drive sector-wide transformation.

It is good to note that the bank is on track with developing NMR as a digital App. As of March 2025, the APP had been developed. It is currently in its final testing phase, with deployment expected later this year. Following the test running, the bank will be finalizing system security protocols and integrating with existing banking and land registry platforms.

FMBN is further considering plans to conduct training programmes for financial institutions and real estate developers to ensure smooth adoption of the NMR, while also planning the launch of a nationwide public awareness campaign to educate Nigerians on how to access and use the registry.

The expectation is that as a transformational tool, this App will redefine mortgage banking in Nigeria. By enhancing transparency, improving efficiency and expanding access to mortgage financing, the NMR is poised to accelerate homeownership, attract investment and drive economic growth.

– Culled from BusinessDay