Investing in REAL builds loyalty, shows responsible investment in action, and proves funds can improve lives without compromising fiduciary duty.
Why Partner With REAL
Optimise your investment risk profile. Support your members. Deliver real impact.
REAL offers retirement funds a unique opportunity to invest in a home finance solution as part of the fund’s investment strategy that delivers both measurable social impact and sound financial returns. Through a single structured investment, your fund enables its members to access affordable, responsibly structured home loans — without requiring a deposit or early access to their retirement savings.
The Freedom Charter claims “There shall be houses, security and comfort!”
Empower your members. Back a future where they can Own It.
Unique Investment Opportunity for Retirement Funds
Responsible. Secure. Real returns.
Investment by retirement funds in a REAL debt instrument is expected to produce real returns of approximately 4% p.a, while also providing its members access to this exceptional home loan product. Such investment’s contribution to ESG principles is obvious, as it meets a crucial social need of the membership – The need to own your own home.
This investment has an exceptional risk/return profile when considering the stable real returns and low risk of under-performance given all the risk mitigating features of the investment.
Credit risk mitigation
There are multiple layers of protection behind this investment to limit the Fund’s exposure to credit risk to the absolute minimum:
Each loan is financed directly from your fund’s investment and secured by two layers of protection:
- A pension-backed guarantee, typically covering 15-25% of the loan value at outset, linked to the member’s retirement benefit
- A mortgage bond registered over the property being purchased
This dual security structure ensures that the fund’s exposure to credit risk is limited and well protected, while still delivering maximum accessibility to members.
History has shown that the risk of non-payment reduces dramatically when instalments are collected by way of payroll deduction. This significantly reduces the Fund’s exposure to credit risk which, in turn, is shared with the members through a substantial discount to the interest rate applied to their loan.
The pension-backed guarantee provides 100% security due to the ease of collection through the applicable legal and administrative processes. A greater portion of the total loan is therefore transferred to the pension-backed loan once a year as the retirement benefit grows, thereby further reducing the credit risk over time.
The benefit of lower risk over time is, again, also recognised in a lower average interest rate on the member’s total loan as the pension-backed loan becomes a greater portion of the total loan.
We strictly adhere to responsible lending practices. A detailed affordability assessment and extensive credit checks are performed on each application to ensure that the member can afford the repayment of their loan.
The repayment schedule and dynamic interest rate applicable over the lifetime of the loan further ensures that these repayments remain affordable.
All loans require life cover and property insurance, which ensures that the loan can be settled in the event of death or permanent disability or if the property should be damaged.
Insurance is sourced through accredited partners or may be arranged by the member directly.
The repayment schedule and dynamic interest rate applicable over the lifetime of the loan further ensures that these repayments remain affordable.
In line with international accounting standards, reserves are held by REAL to finance shortfalls, if any, between the value of the outstanding loan and the value of the member’s security in the case of default. These reserves are audited once a year to confirm compliance with the applicable industry standards.
REAL is further subject to, and strictly adheres to, all requirements of the National Credit Act.
If you should prefer the additional security to ringfence your investment from other funds, the Fund has the option to have its investment segregated under a separately registered entity. This does reduce the number of participants in this specific entity which can increase volatility of experience, but it means the Fund is only exposed to credit risk in respect of its own members.
An invaluable benefit to your members
A pathway to homeownership that’s accessible, affordable, and responsible.
REAL gives qualifying fund members access to a home loan product designed specifically for individuals who may not qualify for traditional bank finance, often due to a lack of deposit, variable income, or limited credit history.
This benefit gives members real dignity and financial security.
By enabling homeownership while they are still working, a Fund’s investment in REAL gives Trustees the option to help members build wealth earlier in life and secure a meaningful asset — all while protecting their long-term retirement outcomes.
Access to this home loan finance will be an invaluable employee benefit for employers to offer their employees, and a tangible value-added benefit of membership of your Fund.
Accessible Without Upfront Capital
Affordable from Day One, remaining aligned with your salary
Tailored for Long-Term Affordability
More stable and predictable repayments, even when prime lending rates change
Administered With Care and Support
Opportunity to Consolidate Debt Responsibly
Onboarding Process for Funds
Structured, collaborative, and fully supported.
REAL’s onboarding process is designed to be straightforward, fully compliant, and tailored to the needs of each retirement fund. From the initial engagement to member rollout, our team provides hands-on support to ensure a smooth implementation.
Here’s what the typical onboarding journey looks like:
Introductory Consultation
We engage with trustees, principal officers, and administrators to introduce the REAL model, explain how the investment and lending structure works to fit in with and enhance the fund’s investment strategy, and answer key governance and compliance questions.
Due Diligence & Legal Review
Your team is provided with all necessary documentation to review the legal framework, investment terms, and security structure. We welcome the involvement of your legal, compliance, and investment advisors.
Fund Agreement & Setup
Once approved, we finalise the partnership agreement, confirm the investment structure, and, where applicable, set up a dedicated lending entity linked to your fund.
Payroll & Admin Alignment
We work with participating employers to set up payroll deduction (where available) or establish secure DebitCheck mandates for repayment collection.
Member Eligibility, Education & Rollout
We identify all members who qualifies for a REAL home loan based on their salary, age and fund benefits. We provide educational material, customised estimates and hands-on support to help your members who are eligible for this benefit to understand the offering and begin applying with confidence.
We understand that each fund has its own governance processes and risk considerations. Our onboarding approach is flexible, transparent, and backed by a team with deep experience in both home finance and retirement fund operations.
For a more detailed overview, our consultants are available to guide your fund through each step.
Fiduciary Compliance & Risk Management
Structured for compliance. Built for long-term integrity.
REAL’s home loan structure is designed to align fully with the fiduciary duties of retirement fund trustees. Every aspect of the model, from loan approvals to investment deployment, is grounded in regulatory compliance, risk mitigation, and responsible lending principles. All legal structures, agreements, and operational processes have been designed to ensure transparency, security, and full regulatory compliance.
- Payroll deduction is used where agreed with the employers, ensuring consistent repayment
- Where not possible, DebitCheck mandates are used for direct collections
- Missed payments trigger internal alerts for early intervention and resolution
- Loan repayments are monitored at both the member and portfolio level to flag risks proactively
REAL’s model is fully compliant with:
- Pension Funds Act (including Regulation 28)
- National Credit Act
- FAIS, POPIA, and FICA
- Industry-aligned data protection, risk scoring, and arrears management frameworks
All loan agreements and fund partnerships are backed by legal contracts developed in consultation with Cliffe Dekker Hofmeyr. Internal policies and risk frameworks are audited and aligned with Treating Customers Fairly (TCF) principles and ESG objectives.
REAL maintains internal governance processes aligned with fiduciary, compliance, and Treating Customers Fairly (TCF) principles. These include:
- Regular reviews of legal and policy frameworks
- Ongoing compliance oversight across NCA, FAIS, POPIA, and FICA obligations
- Internal policies governing credit approval, arrears management, fund exposure limits, and overrides
REAL’s governance approach supports transparency, auditability, and consistent engagement with the fund’s board, principal officer, and compliance team.
Frequently Asked Questions
If your question is not listed here, please contact us. We are here to help.
Yes. REAL’s structure was developed in consultation with leading legal advisors to ensure full compliance with all legislation, including the Pension Funds Act and related regulations, e.g. Regulation 28. This investment is a long term debt instrument which is classified as “Other” for the purposes of Regulation 28 compliance.
Loans are structured to fall within acceptable industry parameters, and fund investments are designed to comply with retirement fund investment guidelines.
Each loan is secured by two layers of protection:
- A pension-backed guarantee, typically 15-25% of the loan at the outset, backed by the member’s retirement benefit
- A mortgage bond registered over the financed property
This dual-security structure ensures strong collateral protection.
No. Members do not withdraw or access their savings. Instead, the retirement fund provides a limited guarantee on the member’s behalf. Retirement savings remain intact and continue to grow.
The member can preserve his/her benefits in their old fund, with the pension-backed guarantee remaining intact. However, if the member opts for a cash benefit (e.g. in respect of benefits that accrued prior to the introduction of the two-pot system) the pension-backed loan needs to be settled, and the balance is paid to the member. The member will then still be liable to settle the mortgage-backed loan over time.
REAL has structured early warning, intervention, and recovery processes in place. In the event of non-payment or employment termination, we engage with the member to restructure payments or recover the loan. If unrecoverable, only the guaranteed portion may be claimed from his retirement benefit — the remainder is secured by the mortgage against the property.
Yes. While existing guarantees remain in place for current loans, your fund may choose to pause or end new lending at any time, subject to the terms of the partnership agreement.
REAL provides customised estimators, educational materials, and full onboarding support. Our consultants work directly with members to guide them through the application process and ensure they understand the loan structure and responsibilities.
Where payroll deduction is unavailable, REAL uses DebitCheck, a secure debit order authentication system approved by PASA. Members authorise the debit during onboarding, and payments are tracked in real time with alerts for missed payments.
Yes. Existing property owners may switch their home loan to REAL, provided they meet the credit and affordability criteria. We carefully assess whether the switch is financially beneficial for the member, especially in light of bond registration costs and loan term considerations.