Ecobank to venture into real estate

Enacy Mapakame

Ecobank Transnational Corporation (ETI), parent company for Ecobank Zimbabwe, is planning to expand into real estate, with the bank expected to start to offer loans for building houses to individuals “in the near future,” officials say. With the current rapid urbanisation not only in Zimbabwe but the entire continent, there has been an increase in demand for residential properties in urban centres creating opportunities for mortgage lenders.Zimbabwe has a housing backlog of 1,25 million units while the capital Harare alone has a backlog of over 500 000 units.

Ecobank Group chief executive officer Mr Ade Ayeyemi told The Herald Business that they were expecting the Zimbabwean economy to recover from current weaknesses thanks to its mineral riches and its well educated human capital.

“Yes, it is very likely we will do so (invest in property) in the near future. But the first priority is that of solving the issue of economic performance of the country.

“For us in Ecobank, we feel the Zimbabwean market is good for business and we are confident about success in banking products and services that we are trying to bring to the marketplace,” he said.

Without giving specifics on Zimbabwe’s contribution to total group earnings, Mr Ayeyemi maintained the market remains an integral part of the ETI with its technical expertise and room for technological products testing and in agriculture lending.

These, he said, were Zimbabwe’s competitive advantages in the Central Eastern and Southern Africa (CESA) regional grouping.

“Zimbabwe is now part of our larger Central Eastern and Southern Africa (CESA) regional grouping. We intend to take advantage of the technical sophistication of Zimbabwe,” said Mr Ayeyemi.

Among other projects, the ETI has already launched the Move On Up programme to enhance financial inclusion across the 36 countries it operates in across the African continent.

This mainly targets low income earners, rural communities and the emerging small to medium enterprises (SMEs).

With a boom in the SME across the region, there is scope for financial institutions to tap into the sector, which is mostly unbanked.

Mr Ayeyemi added this is also in line with the group’s commitment to growing African economies through supporting the SME sector.

According to the World Economic Forum, SMEs provide an estimated 80 percent of employment in Africa although they still face serious financial hurdles.