Kuwait is preparing to grant banks permission to offer mortgages for the first time.

Kuwait is on the brink of allowing banks to offer mortgages for the first time, a move expected to bring significant changes to the country's financial sector. According to a report by Bloomberg published on Friday, the law permitting this change is anticipated to be approved soon by the Cabinet.

This decision could open the door to a market worth up to $65 billion, which implies a 40% growth in the credit portfolios of lending institutions. Historically, concerns over the political ramifications of confiscating citizens' homes have kept mortgages unregulated and unapproved in Kuwait. Instead, the government provided a public housing program offering married citizens heavily subsidized housing or land along with low-interest loans. However, due to 103,000 pending applications, this system has come under substantial pressure, with citizens facing waits of up to a decade for home deliveries, prompting the government to consider major reforms in its housing program.