The latest analysis by TransUnion Rwanda which maintains the Credit Reference Bureau further showed that young people are increasingly accessing credit facilities.

Rwandan millennials, born between 1981 and 1996, dominate the banking sector’s borrowing market, at 56.4 per cent, ahead of Gen X, born between 1965 and 1980, who are at 21.5 per cent.

Mobile loans are more popular among Gen Z, born 1997-to date, making up 68.2 per cent of all their loans, compared to 56.3 per cent for millennials.

However, the youngest generation, Gen Z, has a non-performing loans ratio of 7.0 per cent, as a result of a lack of financial education and a need to develop improved credit management skills.

While the uptake of credit facilities is a positive development, it is also an ideal time for financial institutions in the country to commence financial literacy awareness sessions for their clients especially among the youth.

As the middle class expands, banked population increases, lack of adequate financial literacy could undo the gains made.

By focusing on their younger customer's financial wellness, financial institutions will help their customers achieve lasting financial well-being.

While access to loans is progressive, skills to manage the funds will be key in bringing down the non-performing loans as well as avoiding instances such as auction of assets.

The move is also an indication for the need for Rwandan banks to accelerate their drive digitalization in response to consumer appetite for seamless, friction-right online transactions likely to grow due to increased competition.

The development also requires banks to adjust their set up to have greater focus on risk management and customer-centricity, as well as data insights to improve decision-making.

This will also improve the accuracy of predictions to inform strategic decisions.