Since its inception in 2011, the Capital Market University Challenge has reached over 10,000 university and higher learning institution (HLI) students, exposing them to the capital market industry, fostering a culture of saving and investment, as well as preparing them for future roles as investors and professionals in the industry.
The contest, which remains a key flagship programme of Capital Market Authority (CMA), is annually organised as part of its public education and awareness programmes.
Awards are given to the winners in the form of security such as shares or bonds listed on the Rwanda Stock Exchange (RSE) as a way to nurture students on the culture of saving and investing through the capital market in a more practical and engaged manner.
Thapelo Tsheole, CEO of the Capital Market Authority, said the importance of this university challenge is mainly to target many students, teach them about financial literacy, and enlighten them on capital markets, stressing that generally, across the country and in Africa as a continent, financial literacy levels are extremely low.
He noted that there is a profound impact of the programme that targets primarily university students.
"From its inception, more than 10,000 had participated in this programme. They compete at the local level and they also go to the national level.
"If you look at the finals we have held, there are always testimonies from the previous winners who took part in the competition. They are able to share with the university students their experiences, and that to me is a clear example of the impact that can actually be felt across the students. And most of these people are now active investors in the capital markets,” he said.
"During the ceremonies, there are stories of people who participated in the university challenge who have transformed themselves into real business people, who are running mature businesses, who managed to get the idea surrounding the financial markets, and are able to start up a business that is running and growing at a good pace.”
Tsheole said they are going to also look at the working class and other sectors of the population apart from university students to boost financial literacy and uptake of the capital market.
"The biggest challenge is financial literacy and capital markets information which is very limited, not only in Rwanda but also across the African continent. In many countries, less than five per cent of the population invest in the capital market. We need to change that so that the citizens can actually have their share in the economy, in the prosperity of the economy by participating through capital markets. That is the strategy we are pursuing and going to be expanding in the next few months,” he said.
He said the capital market is set to grow with a tangible participation of the youth.
Young people are also encouraged to invest collectively through saving and investment clubs.
This, CMA says, will help prepare them as future investors and professionals in the capital market industry.
"My message to the youth is that the stock market is a benchmark of the economy. It reflects what is actually happening in the economy and, therefore, with this country’s economic performance averaging plus seven per cent annum, it gives them a good opportunity to invest in the market, to set up businesses that they can later structure to bring companies to the market to list them,” he said.
He noted that the capital markets are going to experience very good growth in the coming months.
"We are open to conversation with them or open to talking about opportunities that are offered in the capital market. It is a strategic objective. We might want to open it to more than university students in the coming years so that it is much broader and encompasses a number of participants.
"Some of the plans for investor education are broad. Number one, we need to have frequent information dissemination to investors. We need to explain to the general population and investors in terms of the importance of financial markets and how generally the financial markets work,” Tsheole said.
He added there is a need for more outreach activities to the general population to make the initiative much more impactful.
How university students have leveraged the Capital Market University Challenge
University students who were awarded by the Capital Market University Challenge have managed to create jobs and continue to save through the capital market.
Theogene Kubahoniyezu is one of the students who took part in the 4th edition of Capital Market University Challenge while still at university.
He said they registered as a group for the contest after reading an announcement calling for university students to participate in the Capital Market Challenge.
"We were a group of six students that formed a savings club at campus. We formed this group as a way of paving the way for creating our own jobs after graduation.
"When we heard about the contest, we realised it was an opportunity to boost our savings group. I was among the three students in the group who contested in the essay category and we emerged the first, while three others participated in the quiz category and emerged the first,” he said.
He said that the three students who contested in the essay category were awarded Rwf400,000 which they saved through buying stock shares in I&M Bank that is listed on the Rwanda Stock Exchange (RSE).
The other three students that competed in the quiz category were awarded Rwf700,000 which they also saved through acquisition of shares in Bank of Kigali listed on Rwanda Stock Exchange (RSE).
After the six students received the awards in the Capital Market University Challenge, the group that graduated in 2018 formed a company dubbed "Reliable Immense Company Ltd”.
The company provides practical professional training on computer programmes, software for capacity-building in addition to public health research.
"We have really created jobs thanks to the competition. The company is growing and we have got new shareholders,” he said.
He said that in 2019, they sold their shares in Bank of Kigali so as to get capital to boost the company’s operations.
"We remained with shares in I&M Bank and the shares are still in the bank expecting to get dividends. Capital market is one of the best sustainable channels of saving and investment that provides benefits in the long-term,” he said.
He urged other students to form savings clubs and save through the capital market.
"This is important because by the time they graduate, they will have capital to create jobs. The initiative opens students’ minds and thinking in entrepreneurship,” he noted.
He said they want to raise more capital through the capital market to grow the company
"The more the company grows, the more we join the capital market."
Kubahoniyezu was part of the group that contested in the quiz category.
He said that he also managed to start his own stationary company in Rusizi District, besides being a shareholder in Reliable Immense Company Ltd.
"The Capital Market University Challenge has opened my mind. We work to boost Reliable Immense Company Ltd. I also managed to start my own stationary company worth over Rwf2 million thanks to dividends from the capital market and savings from our joint company.
"We get dividends from our shares on the capital market and buy shares again to accumulate our savings,” he said.
He urged other youth to embrace a savings culture and make use of Capital Market University Challenge and capital market in general.
"We were a saving club at university and Capital Market University Challenge boosted our club which later became a company after graduation,” he said, adding that they are working to grow the company and also do consultancy in statistical research.
Placide Mugenga, another winner, said that after getting the prize, he founded KBL Investment, a company that provides catering and event management services thanks to the capital market competition.
"I participated in the contest in 2022. I got the prize in terms of shares. I continued to increase shares in Bralirwa and I&M Bank. I managed to buy more equipment for my company. I am looking to expand my business,” he said, adding that he also invested in film-making.