City Affairs

City Hall to spend Sh500 million on Employees' Car and Mortgage loans

City Hall in Nairobi. (Photo: Handout)

By Maureen Kinyanjui | Friday, May 31, 2024

The objective of the fund is to provide loans for a member for the purchase, development, renovation, or repair of immovable property, the purchase of a motor vehicle, and refinance.

The Nairobi County Government plans to increase funding for employees' car and mortgage loans to Sh500 million in the next financial year.

As highlighted in the FY 2024-2025 budget estimates, the funds will be raised from the current Sh100 million.

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Initially, the Sh100 million could only cover five residences at Sh5 million each; consequently, the county intends to enhance the amount.

"The sector will require an additional funding of Sh500 million in the next FY 2024/2025 to provide our staff with car and mortgage loans, as the Sh100 million will only cater for 20 houses Sh5 million each," reads part of the estimates.

The county's Car Loan and Mortgage Scheme Fund was operationalised last year.

The objective of the fund is to provide loans for a member for the purchase, development, renovation, or repair of immovable property, the purchase of a motor vehicle, and refinance.

The employees who qualify for the fund include salaried County Executive State or public officers including CECs, an employee on contract serving in the Executive arm being either a County Secretary, Chief Officer, or Member of the County Public Service Board.

Others to be considered include an employee on a permanent and pensionable basis serving in the Executive arm, an employee seconded from the National Government to public office in the Executive arm of the County, and an officer employed on a contract basis by the Executive arm.

For a car loan, all applicants must provide certified copies of identification documents, a certified copy of the duly executed and stamped agreement for sale, a current copy of records from the Kenya Revenue Authority, and a certified copy of the log book of the car set to be purchased.

"All legal transactions in respect of the property being purchased shall be conducted by a duly licensed advocate selected from a panel of legal service providers approved by the committee," reads part of the regulations.

The regulations outline penalties, limits for loans, disbursement of loans, repayment, and valuation of the car or property.

This scheme started in 2013, is part of the county's effort to help its employees.

Other initiatives the county intends to use to enhance worker morale include providing medical coverage, establishing affordable housing, teaching people about mental health and work-life balance, and collaborating with trade unions and pension committees to address this.