The Development Bank of Rwanda (BRD) and the East African Development Bank (EADB) on Thursday signed an agreement under which the former will receive a credit line worth $15 million (about Rwf11 billion) to increase its lending to the private sector.

Officials said the new credit facility will help BRD extend long-term loans to medium, small and micro-enterprises in various sectors of the economy across the country.

The deal is seen as a major boost to BRD’s efforts to scale up its operations to deliver on its mission of extending affordable credit to the private sector, which does not only help accelerate economic growth but also directly impacts households since more investments create new jobs and markets.

The development bank plays a major role in financing important projects in such areas as housing, exports development, energy and agriculture.

And, just as BRD and EADB were concluding the deal, an equally important event was going on in Kigali: the first conference on Local Economic Development Investment.

Participants explored opportunities presented by Local Economic Economic Development investments, but also noted that financing remained the single most important impediment to private investments.

While the latest BRD-EADB deal will help respond to concerns about limited financing for crucial private projects across the districts, it is important that emphasis is put on projects with a high return and which will benefit more people.

For instance, there is need to avail much more credit to the private sector, especially SMEs, and to developers particularly for low and middle income housing schemes.

All this calls for proper coordination between the central government, districts and financial institutions, including BRD and other banks.

Needless to say, there is need to make credit more affordable because the current interest rates are prohibitive to many people.