Borrowing after retirement on an INSESO pension
In Equatorial Guinea, a retiree can obtain a small loan if their pension, paid notably by INSESO, goes into a bank such as BANGE or SGBGE, but age, term and death insurance sharply limit the amount available.
The pension as the only income the bank can capture
For the bank, the pension replaces the salary as the guarantee of repayment. It must be paid regularly into an account at the lending institution, so the monthly instalment can be deducted at source. This avoids any monthly trip to the counter.
The role of INSESO
The National Social Security Institute, INSESO, manages the pensions of affiliated employees. A pension certificate issued by this body is generally required to show the amount and regularity of the retiree's income to the lending bank.
Former civil servants and oil workers
Former State employees and retirees from oil companies often have the most stable pensions. Former informal workers who were never affiliated, on the other hand, have no retirement income at all to present to a bank.
Maximum age set by Malabo banks
Banks set a maximum age at the final instalment, which varies by institution and insurer. The older the borrower, the shorter the possible term and the higher the monthly payment for the same amount borrowed.
Death insurance and health
Death insurance becomes more expensive and sometimes hard to obtain beyond a certain age. The insurer may ask for a medical questionnaire, and its refusal can lead to the loan being refused, whatever pension the applicant receives.
Small loan amounts
Retirees borrow mainly for home improvements, medical costs or helping grandchildren. The products available resemble the personal loan in Equatorial Guinea, with shorter terms. The amount generally stays modest, matched to the pension received.
Renovating your home in retirement
Improving a family house in Malabo, Bata or a village in Río Muni is a common project. Questions of title and mortgage are covered on the page about the Equatoguinean home loan, which explains what banks require.
When the pension reaches the account late
When pension payments are delayed, the bank may debit an account with no funds and charge for payment incidents. Keeping a small reserve avoids piling up fees during these periods. Talking to the branch adviser can sometimes postpone an instalment.
Retirees returning from Spain
Some Equatoguineans return home with a Spanish pension. The local bank can take it into account if it is transferred to an account in Equatorial Guinea, with conversion from euros into CFA francs XAF each month.
Family solidarity and mutual help
In many families, it is the working children who pay for their elders' needs. This support avoids costly credit, but it depends on the relatives' own situation, as they sometimes have no formal job. These children often live in Malabo or Spain.
Phone fraud aimed at Equatoguinean pensioners
Fraudsters call retirees pretending to be the bank or the pension fund in order to obtain their codes. No legitimate organisation ever asks for a secret code by phone or by message, so such calls should be ended immediately.
Retirees in Congo-Brazzaville
In Congo, retirees also face age limits and pension delays. The page on the loan for retirees in Congo describes the situation in that CEMAC country. The solutions Congolese retirees turn to are also presented there.
Applying for credit on a pension
- Obtain a recent pension certificate from INSESO or the paying body.
- Check that the pension has been paid into an account at the bank you approach for several months.
- Ask about the age limit applied and the maximum term possible before setting the amount.
- Fill in the death insurance questionnaire and wait for the insurer's approval.
- Compare the final TEG and sign the contract after reviewing it with a trusted relative.
What weighs on the cost of a loan in retirement
| Item | Factor | Effect |
|---|---|---|
| Death insurance | Age and state of health | Premium rises with age |
| Short term | Bank's age limit | Heavier monthly payments |
| Interest | Bank and amount | Compare via the TEG |
| Arrangement fee | Price list | Proportionally heavy on a small loan |
Paperwork a Malabo bank asks of pensioners
- DIP or passport
- Pension certificate from INSESO or the paying body
- Bank statements showing the pension being paid in
- Proof of address
- Health questionnaire for the insurance
What makes a retiree's application fail
- Asking for a term that goes beyond the bank's age limit, which leads to the file being automatically refused.
- Not having the pension paid into the lending bank, depriving it of its main guarantee.
- Giving your bank code to a fake pension fund agent who calls you on the phone.
- Guaranteeing a son's or daughter's loan without realising that the INSESO pension could be seized if payments stop.
Equatoguinean retirees' questions about borrowing
Is there a maximum age for borrowing?
Yes, each bank sets an age limit at the end of repayment, often linked to the insurer's conditions. This ceiling shortens the possible term and therefore reduces the amount an older retiree can borrow from the bank.
Is an INSESO pension enough as a guarantee?
It forms the basis of the file if it is regular and paid into the bank. The bank may nevertheless ask for death insurance and sometimes a guarantor for larger amounts borrowed by the retiree.
Is a foreign pension taken into account?
A Spanish pension or one from another country can be counted if it is transferred regularly to a local account. The bank takes into account the exchange rate risk between the foreign currency and the CFA franc XAF.
What should you do if your pension is late?
It is advisable to warn the bank as soon as the delay is known in order to avoid incident charges. A small precautionary savings pot can also cover one or two monthly payments during these periods.