Rent assistance beneficiaries will payback with 12% interest

The head of Public Relations at the Rent Control Department, Emmanuel Hovey Kporsu, has explained that beneficiaries of the National Rental Assistance Scheme will pay back any loan granted with a 12 percent interest rate.

Mr Kporsu said the interest will be split between the government and the scheme.

“This is a revolving fund from which the government is also going to benefit. The interest on it is about 12 percent and there is a cost-sharing between the government and the service provider. If we are to pay the rent, and we pay GH¢1000, 12 percent will be added and that 12 percent will be shared between the service provider and the government, and it will be reinvested into the scheme,” Mr Kporsu said in an interview on Face to Face on Tuesday, January 31.

He also disclosed that the scheme will be eventually extended to all 16 regions of the country after the pilot phase in five regions namely; Greater Accra, Ashanti, Western, Eastern, and Bono East Regions.

Applicants who intend to rent an apartment that cost more than GH¢1500 monthly are not qualified under the scheme.

The government on Tuesday, January 31, duly launched the National Rental Assistance Scheme as part of measures to provide decent accommodation for Ghanaians.

Ghanaians above the age of 18 with a valid national ID card and verifiable employment with an income, qualify for a rent loan in five to ten working days under the scheme.

Total rent is paid to the prospective landlord of the applicant and the applicant in turn makes a monthly payment to the National Rental Assistance Scheme.

Mr Kporsu added that applicants will be evicted from the apartment if they default on the monthly repayment arrangement with the scheme.

Speaking at the launch in Accra on Tuesday, January 31, vice president Dr. Mahamudu Bawumia said the five regions were “selected for the pilot because they are where there is pressure on rent in the country.”

Dr. Bawumia said, unlike previous policies which are often marred by defaulters, the National Rental Assistance Scheme is in collaboration with private investors who wouldn’t want their investments to go down the drain and will use any means possible to retrieve their funds which will also eliminate any form of political interference.

He also disclosed that the government through the Ministry of Works and Housing has submitted a bill to Parliament seeking to replace the current rent law which was passed over five decades ago and has lost its relevance.

“I am happy to inform you that the government has made significant strives as far as the housing sector and renting management are concerned. Government acting through the Ministry of Works and Housing has submitted to Parliament for consideration and passage, a rent bill to replace the existing Rent Act of 1963 Act 220. The current Act was passed by Parliament 59 years ago and therefore its relevance has been outlived by the current population growth, urbanization, housing availability, and general trends.”