Research On Finding Barriers To Access And Usage Of Housing Finance In Zambia tender job at Habitat for Humanity International (HFHI)

About Habitat for Humanity International (HFHI) – Terwilliger Center for Innovation (TCIS)
Habitat for Humanity International (HFHI) is anchored on a fundamental vision of a world where everyone has a decent place to live. This vision has been the driving force in all HFHI’s actions and activities that have seen more than 29 million people around the world supported to build or improve the place they call home. To further fulfil this vision, HFHI established the Terwilliger Center for Innovation in Shelter (TCIS) to build and expand inclusive housing markets by supporting local firms to innovate and expand client-responsive services and products.
Habitat for Humanity Great Britain (Habitat GB), Habitat for Humanity Zambia (Habitat Zambia) and Habitat’s Terwilliger Center for Innovation in Shelter (TCIS) are embarking on a new 4-year project namely, “CASH -Creating Access to Safe Housing:
Building Financial Inclusion and Resilience for Women in Zambia”. To achieve the project objectives, one of the key deliverable is to develop inclusive housing finance products for LIH’s. To that note, HFHZ and TCIS are embarking on this research “Research on finding Barriers to Access and Usage of Housing Finance in Zambia”, to identify the barriers towards access and usage of housing finance but also product mapping to help identify the product needs and potential requirements from the demand side.

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Background
While poverty in the country is clearly influenced by multiple complex factors, Habitat Zambia’s research found that there are two key drivers contributing to the poor financial status of persons living in Zambia:
• Low levels of Financial Literacy
• Limited access to Financial Services
• Low levels of financial literacy and access to financial service are the key contributors to poverty in Zambia. There is a strong link between poverty and housing, yet Zambia is on course to have a housing deficit of 3 million units by 2030. While access to affordable housing and housing finance is a proven pathway to poverty reduction, the lack of these options in Zambia means this pathway is closed for most of the population. Women are more adversely affected by these issues than men. A major consequence of these two drivers is a total lack of adequate housing for most Zambians, exacerbated by the unavailability of affordable housing finance.

The lack of affordable housing in Zambia means that many residents find themselves living in substandard houses in informal settlements. Figures indicate that as many as 70% of urban dwellers live in informal settlements (UN Habitat, 2018). These informal settlements are full of makeshift, low-quality houses with most residents unable to afford to improve their homes. There is also the issue that most people living in informal settlements do not have security of tenure. Without tenure, residents are unable to leverage the value of their homes and are unable to use their homes as collateral to access formal financial services.

Zambia’s current housing deficit is approximately 1.5 million units, with this figure projected to reach 3.3 million units by 2030 (National Housing Authority, 2022). Whilst the Government of Zambia has expressed an intention to resolve the housing crisis, the country ultimately faces a lack of functional policy and finances to address this issue at a public level (Policy Monitoring and Research Centre, 2018).

Habitat for Humanity believe this gap provides an exciting opportunity for the private sector. Our experience globally demonstrates that access to housing finance allows low-income families an affordable way to improve housing. However, the private sector in Zambia currently prefers to issue mortgages to those on middle/high-incomes and offers little housing finance opportunities for those on low-incomes. In addition, from our consultation with FSPs, the lack of a credit history/scoring system to help reduce the risk of lending is arguably one of the biggest barriers to the development of sustainable housing finance on the supply side.

Objective(s)
One of the significant barriers to housing affordability is the availability of and access to housing finance. Hence, HFHZ and TCIS will work with its Financial Institution partners, utilising the market systems approach, to scope the housing finance ecosystem in Zambia, identify the critical barriers that hinder the housing finance growth and developing housing finance product(s)/solution(s) to address those barriers to bring market-wide impact, particularly for low-income households in Zambia.

Specific objectives of the research are;
Identify the systemic barriers preventing access and usage of housing finance in Zambia.
Perform a holistic assessment of the housing finance market. This includes;
• all the market players (government and non-governmental agencies, financial service providers and non-financial providers that play a bridging role in access to housing finance)
• current housing finance products available catering to various customer segments (stand-alone products, tagged along products and undefined housing products),
• current and future financial needs for other housing finance value chain actors (Micro Small and Medium Enterprises (MSMEs) and developers)
• Unpack the demand and supply side housing finance needs, challenges and opportunities as well as assessing the support functions available to promote affordable housing finance.
• Review existing regulations, policies and laws that support and hinder housing finance
• Give recommendations on opportunities to address the housing finance barriers in specific sectors that will bring impact to the market in the short, medium and long term;
• Identify potential investment opportunities in housing finance that will help the supply side in accessing and providing capital/investments in housing finance initiatives within the supply chain.
• Understanding the needs, preferences, and capacities of low-income households and savings groups for improving their houses, client satisfaction for house microfinance products to be offered by partner MFI’s and the dynamics around household’s decision making related to construction.

Focus on understanding the needs, preferences, and capacities of low-income households for improving their houses, client satisfaction for house microfinance products currently being offered in Zambia
• Identifying future needs by the demand side, and the dynamics around intra-household decision making related to construction
• Developing LIH persona’s in relation to potential housing finance products
• Map current customer journey towards access of financing and housing construction
• Provide detail current housing finance products assessment and summary of current offerings in the market (at different market level i.e. high, middle ad bottom of the pyramid)
• Identify opportunities for housing finance products and providers (example Fintech)

Scope of Work
The selected company/consultant must undertake the research using the market systems approach. Hence, the following activities:
• Market Research
• Market Analysis
• Map out all the governmental and non-governmental agencies, financial and non-finance service providers in the market and other actors involved in the housing finance ecosystem. This includes those directly offering financial solutions to the consumer and those offering financial solutions to SME’s (actors within the housing ecosystem)
• Provide details of the current housing and housing finance ecosystem in Zambia
• Map out all the products/solutions related to housing finance being offered in the market by the financial and non-financial service providers.
• Identify supply side financial needs and investment opportunities in housing finance in different levels (Banks, MFIs, Credit Only, Sacco’s etc)
• Through a defined sample size, identify the demand side housing finance current and future housing finance needs particularly for low-and middle-income households (LIH’s)
• Identify the financial needs of housing ecosystem value chain actors i.e. Micro, Medium and Small Enterprises – MSME’s as well as developers
• Map out the current housing finance investors.
• Identify the short-, mid- and long-term market sustainability goals of housing finance.
• Identification of Systemic Barriers
• Identify systemic barriers that hinder access to housing finance solutions from the demand-side.
• Identify systemic barriers that hinder provision of housing finance solutions from the supply-side especially in different levels (Banks, MFBs, Credit Only, Sacco’s, FinTechs etc.)
• Identify regulatory/policy barriers that hinder the smooth provision of housing finance solutions to the market.
• Identify market barriers (infrastructure/data/etc.) that hinder the provision of housing finance products/solutions in the market.
• Identify barriers that hinder investments in housing finance, particularly availability of capital to the financial service providers.

Provide detailed recommendations.
• Propose how HFHZ, its partners and other players can work to address the systemic barriers identified at different levels i.e., demand-side, supply-side, markets and policy/regulatory environment(s) in respect to Banks, MFI’s, Saccos etc.
• Propose opportunities for the investments in the housing finance sector/market.
• Categorize the recommendations in terms of short-term, mid-term and long-term implementation based on impact.
• Suggest on the partners who HFHI-TCIS can work with to address those barriers.
• Propose how HFHI, its partners and other players can deepen their engagement with relevant governmental agencies in a structures and measurable manner towards tangible effect in stimulating the accelerated growth of affordable housing.

Product Research
The research would include an in-depth analysis of the demand for housing microfinance products and housing support services in Zambia particularly in the project geographies. The study will be conducted as desktop research but also on the ground analysis to identify the specific housing finance products particularly microfinance product needs of the low-income households. This will include defining customer journeys and profiles.
Demand evaluation: Assess the housing and finance needs, preferences, and capacities of the target population. The primary research should also be complemented by the secondary research on the demand and supply of housing finance products in the identified geographies. – Client segmentation: Segmentation of the clients based on demographic/socio-economic characteristics and product feature preferences. – Client satisfaction: Assess the clients’ satisfaction levels with the existing housing microfinance products and other services offered by the FSP’s – Client’s affordability: Analysis of the client’s affordability for availing housing microfinance/home improvement loans, which will primarily involve understanding overall income and expense pattern of low-income families. – Competition analysis: Understand the competitive landscape for the FSP’s particularly microfinance institution regarding similar housing microfinance solutions in the areas using both secondary and primary research phases.
Results from this research will help the TCIS and its Financial Institution partners to develop a new affordable housing finance product and/or revise the existing housing microfinance product that meet the needs of low-income households. The study will help gain important insights regarding the most effective delivery/processes of such products, how design may address or affect gender dynamics, and what elements of construction resiliency should be prioritized. Data gathered during the quantitative research process will help in projecting demand for housing microfinance among target segments, including market potential, specific home improvement activities including energy efficient interventions, and ceilings for the loan amount and tenure in operational geographies of the project. This information will also provide the basis for financial projections.

Research Dissemination
The Consultant is required to participate in the dissemination of research results to the market. This will be discussed and agreed upon with HFHZ and TCIS and its partners during the inception meeting.

Note:
Data Management: HFHZ/TCIS will own the data collected and hence be able to utilize the data after the study/contract is completed. The consultant is required to submit all the detailed data in its raw nature collected during the research

Research Methodology
Although we recommend the research company/consultant to provide the methodologies used to conduct the research, it is proposed to first conduct a macroeconomic environment and policy analysis of constraints and opportunities for housing finance in Zambia, followed by stakeholders mapping and engagement with potential partners, and finally working with key stakeholders to assess potential market demand for affordable housing finance products and services.

At a minimum, we anticipate the below to be covered within the methodology:
Diagnostic and market assessment
• As a first step in the diagnostic and market assessment, to conduct an analysis of the housing finance systems in Zambia and explore the macroeconomic environment and its effect on access to housing finance for the low-and middle-income households
• Market assessment of housing finance products in the market at different levels of income

Housing finance market analysis
• Identifying the market constraints preventing lending to low-an middle income households for housing purposes, as well as opportunities for addressing these constraints and effectively serving the target market segment
• Identification of general demand side constraints and analysis to primarily serve to identify supply-side constraints to the provision of housing finance services to low-and middle-income households
• Understanding the variety of financial institutions in Zambia (banks, financial institutions, fintech firms etc) and their respective challenges in extending housing finance solutions, including prohibitive regulations, lack of familiarity with housing needs and perceptions around lending to low-and middle-income households
• An in-depth desk review of the existing policies, regulations, and government programs in Zambia for promoting affordable housing and housing finance, most importantly among low-and middle-income households. To be conducted primarily through desktop research, stakeholder interviews with key experts to inform and validate the findings.
• Understanding main sources of financing for low-and middle-income households within and outside of the formal financial system including housing construction decision-making
• Analysis of government housing programs and their impact on low-and middle-income.

Product Assessment: Housing Microfinance
• The consultant may adopt a combination of qualitative and quantitative research techniques for meeting the objectives
• The consultant must conduct 4-6 client FGDs, 1-2 MFI staff FII’s and 3-5 semi-structured individual interviews, and approximately 60-100 sample respondents (for the quantitative component).
• For semi-structured interviews, the consultant will target other stakeholders that low-income families interact with during their house construction/improvement process, such as masons, building material suppliers, foremen, local authorities and community leaders
• Findings from these semi-structured interviews should help in the triangulation of overall observations.

Stakeholder mapping and supply-side assessment
• Utilising findings from the macroeconomic analysis and further desktop review of financial institution profiles and their offerings (available on their websites/annual reports/industry reports) to map the stakeholder landscape, highlighting types of institutions most likely to have the capacity and interest in serving the target segment with housing finance products and services.
• Selecting a variety of financial institutions (in terms of their legal forms and business models) representing the different channels available to the target segment, to construct a good picture of the supply side of the market.
• Exploring the offerings of digital solution providers, particularly fintech firms and hybrid business models in which incumbent financial institutions partner with various digital platforms. We will consider this as potential financial institution in the supply side landscape.
• Consider talking to industry associations or consumer groups and housing advocacy groups to understand their perspectives on the research topic (informing both the supply and the demand lens).

Demand-side assessment
• Focusing on understanding the needs, preferences, and capacities of low-and middle-income households, for acquiring their houses, as well as the dynamics around intra-household decision-making related to construction.
• Utilising the qualitative approach and an in-depth, semi-structured interviews of approximately 100 households (potentially female owned households)
• Analysis to also seek to identify the size of the market which could benefit from these new products.
• The research will not only support the supply side through private sector actors but will also advocate Government to create a favourable regulatory and policy environment that actively promotes housing finance for those on low incomes.

Deliverables and Milestone
Inception report: (2 weeks after contract signing)
This will be an Inception report detailing how the consultant is planning to undergo the research. This should include; deliverables, methodology and work plan
• Proposed structure for the supply and demand side assessment
• Detailed work plan and proposed methodology (sample design and market survey instruments), to respond to the objectives of the research

Market Analysis Report (Secondary/desktop research): (2 weeks after delivery of inception report)
• Supply-side assessment: all the financial and non-financial service provides in the market that offer housing finance solutions to the public and housing value chain actors (SME’s), detailing available products/solutions related to housing finance in the market, and possible indications of accessibility requirements (KYC/due diligence) and cost structures.
• Demand-side assessment: providing detailed insights on the current behaviors’, uptake, usage and beneficiary needs of housing finance products/solutions as well as challenges, barriers and opportunities.
• Regulatory and policy assessment: clearly identifying gaps in the regulatory landscape towards provisioning of affordable and appropriate housing finance products/solutions in the market.
• Market assessment: providing investment/financing landscape and needs for the housing value chain actors (SME’s) including the current investment models/approaches.
• Product Assessment: providing detailed market wide housing microfinance availability, size, potential and opportunities. This will also include mapping all the FSP’s providing housing microfinance products with product features

Draft Report: Primary research report highlighting observations, findings and recommendations (1.5 months after delivery of market analysis report)
• A draft report detailing the systemic barriers identified and recommendations on how to address them to bring the impact anticipated.
• Final report: including a slide deck on key findings to HFHZ/TCIS (2 weeks after receiving comments on the draft report)
• Final report on findings and recommendations taking into account all the comments that would have been shared in the draft report
• Raw cleaned database of sample respondents in the excel format annexed to the primary research report

Report Format:
• Market analysis and draft report should be delivered in word format (soft copy only)
• Final report should be in Microsoft word digital format (soft copy and hardcopy if requested) and Slide deck should be in PowerPoint format following HFH standard reporting format (this will be shared by HFH)

Note:
HFHZ/TCIS will discuss with the consultant on the final report structure

Eligibility Criteria
The research company/consultant should:
• Have at least 3 experiences in conducting market systems research/studies preferably in Africa.
• Assigned personnel should have the relevant qualification in the field of research, finance, and housing.
• Understanding of market systems approaches.
• Solid experience in quantitative and qualitative research.
• Experience in research of the microfinance sector and its clients.
• Understanding of socio-economic context and regulatory environment of Zambia and having local presence to understand the local languages
• Experience researching in housing/housing finance is an added advantage.
• Understanding of the housing finance in the context of Africa
• Ability to achieve maximum scope of reach with limited resources.

Proposal Evaluation
Proposals will be assessed according to:
• Relevant, demonstrated competence and expertise of firm and key individuals
• Demonstrated expertise of similar research
• The best methodology to achieve value for money
• Content and quality of the proposal
• The most cost beneficial proposal

Application Procedure
The Consultant/agency should submit a technical and financial proposal for carrying out the assignment.
Submitted Proposals must include:
• Technical proposal responding to the TORs not exceeding 20 pages demonstrating familiarity with the subject matter including a) project background, b) proposed report structure, c) any ethical considerations, and d) detailed work plan
• Statement of qualifications of the firm(s) as relevant to the research project
• Supporting documents for registered firms including at a minimum; company registrations and Tax clearance certificate(s).
• A confirmation of your status as an institution/firm or (in case of an individual consultant) independent contractor or employee of a consultancy firm or research institution (for contracting purposes).
• Related experience of the applicant entity(s) with curricula Vitae (CV) for consultant/all team members applying for consideration, with the contact details of three professional referees.
• Financial proposal in Zambia Kwacha (ZMK) itemizing estimated costs for services rendered (daily consultancy fees) and any other related supplies or services required for the consultancy.
• At least one sample report similar to that described in this TOR.
• ONLY electronic submissions will be accepted.

Proposals will be ranked according to how they fulfil the three following requirements:
Qualifications (50%)
Methodological approach (25%)
Price (25%)
HABITAT’S STATEMENT OF EXPECTATIONS SURROUNDING SAFEGUARDING
Habitat for Humanity Zambia requires that all consultants take their ethical responsibilities seriously to safeguard our intended beneficiaries, communities, and those with whom we work. Habitat for Humanity Zambia has particular responsibilities to support and develop systems that create and maintain an environment that prevents harassment, sexual exploitation, and abuse; safeguards beneficiaries and community members (especially children); and promotes the implementation of Habitat for Humanity’s code of conduct.

How to apply
Interested candidates should submit their application materials by 25th June 2023 to Procurement@habitatzam.org.zm: with the subject line**: RESEARCH ON FINDING BARRIERS TO ACCESS AND USAGE OF HOUSING FINANCE IN ZAMBIA**
Cc: Human Resources Administrator – Ms. Nchimunya Hanjalika
Email: nchimunyahn@habitatzam.org.zam
Application materials are non-returnable, and we thank you in advance for understanding that only short-listed candidates will be contacted for the next step in the application process. Applicants will be short-listed for a panel interviews.
The estimated start date will be right after the contractual process finalization (expected to start 10th July 2023)