Credit Reference Bureau (CRB), a credit solutions provider, has started a campaign to sensitise borrowers about its activities and the importance of repaying bank loans in time. 

CRB is an institution licensed by the central bank; it collects and keeps data on borrowers in the country to support financial institutions in risk management through accessing credit reports from borrowers.

Aimable Nkuranga, the CRB country manager, said the drive is part of the efforts to educate clients on the benefits of maintaining a clean credit record.

It will cover Kigali suburbs of Nyabugogo, Gakingiro, Kimironko, Mulindi, as well as Rwamagana and Kayonza districts.

"We want to educate local traders so that they understand that good credit management can improve their businesses,” he said.

Nkuranga added defaulting on loan repayments damages a business’ or individuals creditworthiness, making it harder for them to access more funding from banks in future, or having to pay higher interest rates.

Nkuranga is optimistic the sensitisation will help borrowers understand the benefits of repaying loans in time, which could reduce bad loans in the financial sector.

He said most clients delay loan repayments or take longer to meet their loan obligations.

Currently, Rwanda’s credit status stands at B+ but could improve if all borrowers met their obligations.

Commenting on the issue, Lawson Naibo, the Bank of Kigali chief operating officer, said some borrowers use the loans for activities other than what they stated in their loan applications.

"This contributes greatly to non-performing loans and eventually individuals may fail to pay back the money since it was diverted to activities that are not bringing in profits,” Naibo said.

That’s why CRB plans to launch a credit score next year to further improve the evaluation of creditworthiness of borrowers, according to Nkuranga.

Martha Mulindangabo, the CRB business development manager, said that sensitising the public on how the organisation intervenes in their way of accessing credit facilities will improve their business.

Mulindangabo explained that market vendors, retailers and whole sales need to understand how to use loans properly to grow their businesses.