Serageldin proposes a multi-tiered model for financing affordable housing

Up to $3 trillion from the private sector could be mobilized to provide affordable housing for low-income populations, provided a multi-level financing system and effective risk mitigation mechanisms are established, stated Ismail Serageldin, Co-Chair of the International Nizami Ganjavi Center, at WUF13 in Baku, according to Report.

He said that global private resources are currently estimated at $470 trillion, while annual global savings amount to about $30 trillion. Directing even less than 10% of these funds into the housing sector through a securitization system could radically change housing affordability.

Serageldin noted that financial inclusion for the population should be implemented gradually, starting with microfinance for the poorest groups.

As examples of successful models, he mentioned the Grameen Bank, which brings together 12 million participants, 97% of whom are women, as well as the SEWA association.

The next stage, he said, should involve the transition to full banking services, following the BancoSol model, which enabled millions of small entrepreneurs to join the formal economy.

"The final step is to involve international institutions, regional organizations, and central banks in de-risking housing projects, which will open access to the enormous resources of the private sector," he said.