SOLOMON Finance Ltd (SFL) is set to open for business on Monday.
Located on the ground floor of Anthony Saru building in central Honiara, SFL is a credit institution Solomon Islands National Provident Fund (NPF) established to issue out loans to its members.
Yesterday, NPF board members and staff, along with invited government and private sector officials, gathered to witness the launch of SFL operations.
NPF’s deputy board chairman David Rupokets said the launch of SFL marks another milestone in NPF’s 44-year journey.
“Besides being an investment for the members of NPF, SFL is also a service and benefit to our members where they can access financing to support them with their retirement goals, without touching their retirement savings whilst they are still in employment,” Rupokets said.
“It has taken the SINPF board past and present, more than 11 years to achieve its vision to provide this pre-retirement credit solutions to our members through a wholly-owned credit subsidiary,” he added.
Rupokets explained SFL is not an early withdrawal channel for members to withdraw their contributions from the Fund.
“Rather, SFL is a channel that will encourage members to develop personal retirement plans carefully before seeking financing from SFL.
“In this way members will able to build up their wealth and savings and enable them to enjoy a comfortable retirement in their sunset years.”
Rupokets also shared a predicament SINPF board has been facing when considering member requests for exemptions for partial withdrawal of their savings.
“The dilemma faced by the board is reconciling these requests against the key object of the fund that their funds accumulated over time should be held for their retirement and old age.
“Today, these exemption requests made to the Ministry of Finance is increasing.
“For the first eight months of our 2022 financial year, we have received more than 400 requests for exemption.
“The major reasons for the exemption requests are school fees, medical and health fees, building of a house, purchase of a land and establishment of a small income generating business.
“When members draw on their retirement funds which are intended for their old age, they will reduce what is available to them when they reach their retirement age.
“With the commencement of SFL, members can now channel these requests through the SFL with well-planned proposals,” Rupokets said.
General Manager of SINPF Mike Wate said previously the Board has loan schemes for its members namely the Urban and Rural Housing Home Scheme and Members Furniture Loan Scheme.
But Wate said these were discontinued in the late 1990s as they were not feasible to be performed inhouse due to the small sizes of the loans.
He added the restarting of the loan scheme becomes possible after SINPF acquired government-owned Solomon Islands Home Finance Limited in 2009.
With SFL, Wate said instead of it providing home loans only, it must also provide other small personal loans for members.
“This will not only expand benefits to members, but will also improve the new entity’s profitability,” he said.
SFL will be trading is “Our Finance” – issuing loans to NPF members only.
General Manager of SFL, Jefferey Pitamama says NPF members interested in acquiring loans can call in at their office as of Monday.