Kuwait has issued Decree-Law No. 114 of 2026, a new legal framework for mortgage financing that, for the first time, lets commercial banks and other licensed financing entities lend to housing-welfare beneficiaries — a role previously reserved for the state-owned Kuwait Credit Bank (KCB). The decree was reported by the Kuwait News Agency (KUNA) on 11 October 2026 and picked up by Gulf News the following day.
The law is built around Kuwait’s existing public-housing system, not a general retail mortgage product. To qualify, an applicant must meet KCB’s existing real-estate loan conditions and must not have previously received state housing welfare. Beneficiaries can combine “supported” (subsidised, state-backed) and “non-supported” (market-rate) financing under rules the Central Bank of Kuwait (CBK) will set. Repayment is capped at 25 years from first disbursement, in equal monthly instalments, and lenders may reschedule missed payments for up to five years. Importantly, the coverage of the decree makes no provision for foreign residents or expatriates — eligibility is tied to Kuwait’s citizens-only housing-welfare benefit, administered through the Public Authority for Housing Welfare (PAHW).
That citizens-only scope still matters to Kuwait’s large expatriate population, which makes up most of the country’s residents and works for, and banks with, the same commercial lenders the decree newly authorises to issue these loans. The reform marks a shift in what those banks are legally permitted to do, even though it does not change who can borrow from them for housing.
The decree follows a Cabinet-approved draft that Minister of State for Municipal Affairs and Minister of State for Housing Affairs Abdul Latif Al-Mishari presented on 22 September 2026, describing a 15-article law intended to add financing tools for housing projects and shorten the waiting list for state housing benefits. Kuwait’s central bank first raised the idea of letting banks into mortgage lending as far back as 2018; until this decree, KCB remained the sole lender for Kuwaiti citizens buying or building homes under the welfare programme.
Under the decree itself, the Central Bank of Kuwait must issue executive regulations — including the interest or return rates lenders may charge — within six months of the decree’s publication in the Official Gazette. The law’s provisions apply to beneficiaries only once those regulations are published, meaning banks cannot yet issue loans under the new framework; the next concrete milestone is CBK’s rulebook.
References
Gulf News – Kuwait Issues New Mortgage Financing Law for Housing Beneficiaries / Kuwait Times – Kuwait Housing Reforms Target Shorter Waits, Private Developers / AGBI – Kuwait Ready to Move on Long-Awaited Mortgage Law
