Evaluation Summary - Credit lines to Rand merchant bank (RMB), Nedbank and Amalgamated banks of South Africa (ABSA) in affordable housing

In South Africa, for the “Low-cost housing” sector, the credit lines to Rand merchant bank (RMB), Nedbank and Amalgamated banks of South Africa (ABSA) were subject to an evaluation in July 2017.

The lack of access to affordable mortgage finance was identified in 2003 as a key constraint facing low-income households. In accordance with the Financial sector charter’s (FSC) vision, the loans provided to three banks by the AFD aimed at mobilizing private sector funding to support housing policy in favour of low- and middle-income families, thus facilitating access to housing finance for these households.

The evaluation of the credit lines revealed that most mortgage holders who benefited from the programme have been successful in servicing their loans and maintaining ownership of their properties. The spatial implications of the programmes seem however to have been overlooked, and the evaluation mentions that the programmes would have probably been implemented even without the AFD’s financing. Lastly, it recommends the incorporation of a control group to future projects in order to induce knowledge generation.