Mosese Raqio 
[File Photo]
The Fiji Development Bank says its home loan products are designed to prevent borrowers from falling into financial distress, despite concerns over whether low-income families can cope with rising living costs.
FDB Manager Marketing, Events, Communications and Customer Advocate, Kinijoji Bakoso, says the bank applies a strict 40 percent commitment ratio, ensuring total loan repayments do not exceed 40 percent of a borrower’s gross monthly income.
He says a household earning $12,000 per year could qualify for a loan of up to $60,000, with repayments capped at $400 a month, leaving $600 for living expenses.
Bakoso acknowledges questions around whether families can realistically survive on about $150 per week, but says the policy is meant to reduce over-indebtedness and promote responsible lending.
He says the Choice Home Loan was launched last month and will be reviewed after six months to assess performance and customer needs.
Bakoso also highlighted unsecured loan options for rural families without land titles, saying these loans can support home improvements and family welfare.
Responding to criticism about interest rates, Bakoso says FDB relies on bond funding rather than customer deposits, which affects pricing, but allows the bank to continue supporting low-income and development sectors.
He adds that full loan costs, including fees and repayments, are clearly explained to customers before loan offers are accepted.
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