SMEs to receive human capital development

Business Partners International (BPI) says it will focus on human capital development to increase financing to Rwanda’s cash starved Small and Medium Enterprises (SMEs). “Our core focus is to establish a local vehicle in Rwanda that can deliver assistance to local SMEs in a responsible and commercially sustainable manner, while generating an acceptable return to our investors,” Eric Rutabana, BPI Rwanda’s Chief Investment Officer said, Wednesday during the launch of a US$7.2m SME fund. BPI allocated US$300,000 to strengthen management capacity, management information and accounting systems, and consulting projects for new lines of business. Rwanda has 1,230 SMEs with majority of them with limited access to finance due to lack of collateral and capacity to prepare bankable projects, which is responsible for the high rate of business failure in the country. About 82 per cent of SME start ups in Rwanda die in their first year of operations, according to the Ministry of Trade and Industry. BPI targets to have 50 sound and healthy industries in the next five years during the project’s tenure. “This is a new approach of financing SMEs because the problem has not been the funds only but rather how to present bankable projects,” Rutabana emphasised. James Mugisha, a poultry dealer is expecting to benefit from the fund and boost his business to improve his life and create jobs for Rwandans. “I like the criteria to benefit, you do not need security, and we as a young SME, we do not have collateral but they look at how the project will impact the owner, Rwandans through jobs and the capacity of the person to implement the project,” Mugisha observed. His proposal is worth Rwf30 million and if approved, it would increase his current Rwf18m capital and create some 15 jobs. BPI will provide funding, technical assistance for SMEs, and also venture into business to share the risks with an objective to increasing employment and fostering local entrepreneurship in Rwanda. Ends

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SMEs to receive human capital development