I&M Bank Rwanda has secured a €8m (about Rwf7.59b) credit facility from the European Investment Bank to support small-and-medium enterprises (SMEs).

Sanjeev Anand, the I&M Bank Rwanda managing director and Kurt Simonsen, the European Investment Bank (EIB) East and Central Africa boss, signed the  funding deal at the European Union offices in Kigali yesterday. 

This is the second new small business lending programme between the European Investment Bank, the long-term lending institution of the European Union, and I&M Bank in seven years.

"The SME and corporate sector forms the most important part of I&M Bank’s strategy in Rwanda to support the country’s economic development priorities. We believe that the long-term financing line provided by EIB will boost further our efforts geared at providing investment support to SMEs,” Anand said at the signing of the loan deal.

"This is a timely engagement of the EU lending arm in a sector which is most important for the new development strategy of the Rwandan Government,” the head of the EU Delegation to Rwanda, Michael Ryan stated. 

"The EIB support will complement our private sector activities in agriculture, which is one of our focal sectors of engagement during the 11th European Development Fund 2014-2020,” Ryan who witnessed the deal signing, added.

EIB East and Central Africa chief Simonsen noted that the funding would be focused on productive sectors that are currently under-served by commercial banks. 

It targets projects in agriculture, fishing, construction, transport, tourism, manufacturing, education and health care sectors.

"We are looking at building on the success we have had with I&M Bank and other banks in Rwanda, and we believe that the long-term financing provided by the European Investment Bank will go a long way in providing investment support to small-and-medium enterprises,” Ryan pointed out. 

So far, EIB has extended five small business-focused loans worth €31m (Rwf28.4b) to Development Bank of Rwanda, Bank of Kigali and I&M Bank. 

The credit line makes I&M Bank Rwanda the fourth bank to benefit from the €160m regional finance facility programme, which is aimed at enhancing access to investment finance for small-and-medium enterprises in Kenya, Uganda, Rwanda, Tanzania, Burundi, the Democratic Republic of Congo and Djibouti.

More than 10 local banks and 3,000 companies are expected to benefit from the facility.

The funding has helped to develop over 100 SMEs and create more than 1,250 jobs in the private sector.