National Bank of Rwanda has lifted withdrawal limits in Umurenge Savings and Credit Cooperatives (SACCOs) that had been in place since March 2020.
The limits stipulated that an individual would not withdraw more than Rwf150, 000 per week while food dealers and basic materials dealers were not allowed to withdraw more than Rwf500, 000.
Saving groups that work with SACCOs were not allowed to withdraw more than Rwf50, 000 for each member of the group.
The Central Bank announcement said, "Following government guidelines on 30th April 2020 to partially lift the lockdown where some activities have been allowed to resume, the Central Bank informs all SACCOs that withdrawal limits that had been set since in March are now lifted so that members of the cooperatives be able to carry out their activities without obstacles.”
Speaking to The New Times, Prof. Jean Bosco Harelimana, the Director-General of Rwanda Cooperative Agency said lifting the withdrawal limits was timely so that members would be able to recover from COVID-19 impact.
"Lifting withdrawal limits will enable members of SACCOs to do their businesses without financial obstacles and put on the market all that is needed by consumers. They can also expand their businesses so as to satisfy the demand on the market,” he said.
There are 437 SACCOs of which 416 are Umurenge SACCOs composed of over three (3) million members.
The SACCOs, Harelimana said, have Rwf17.6 billion share capital and Rwf113.5 billion deposits as of now.
The total assets of SACCOs are equal to Rwf226.6 billion while the outstanding loans are currently Rwf121.2 billion.
As part of measures to mitigate the economic impact of the COVID-19 pandemic, the Central Bank has requested banks to ease loan repayment conditions to borrowers affected by COVID-19.
It has also put in place a lending facility of Rwf50 billion to banks with liquidity challenges.
Progress on SACCO Automation
In order to curb the spread of COVID-19, banks have introduced cashless payment systems amid the lockdown.
But because SACCOs are yet to be automated, it is difficult for members to abide by the rules.
Prof. Jean Bosco Harelimana said that there is a team composed of IT experts from the Ministry of Finance and Economic Planning (MINECOFIN), Rwanda Information Society Authority (RISA) and Rwanda Cooperative Agency working on the automation project.
"Experts, in charge of Umurenge SACCO business development, are working together. They have developed software that is currently working in Rutunga SACCO in Gasabo, Kanombe SACCO in Kicukiro, and Gisenyi SACCO in Rubavu district. We remain with the rollout for the remaining 413 SACCOs,’ he noted.
The deal to develop SACCO automation was given to local developers after the government terminated contract with FinTech – a Kenyan firm, that had to help automate Umurenge-SACCOs at the cost of $4.6 million (Rwf4 billion) since 2015.
However, the firm was unable to deliver and their contract was terminated in 2018.