Rwanda Development Bank gets $8m to fund SMEs

The African Development Bank (AfDB) and the Development Bank of Rwanda (BRD) signed today a US $8m (about Rwf5.3b) credit line to support BRD lending to the agriculture, agro-processing, telecommunication, education and tourism infrastructure sectors in Rwanda. The loan deal was signed at the AfDB Rwanda office by Negatu Makonnen, the AfDB resident representative in Rwanda and Jack Kayonga, the BRD chief executive officer. BRD is Rwanda’s top development bank that focuses on the small-and-medium enterprises (SMEs) sector. As part of its 2010/14 strategy, its key growth areas include priority SME sectors such as agribusiness, manufacturing, micro-finance, information and communication technology, hospitality, education, health care, energy and water. The partnership between AfDB and BRD is expected to increase SME reach, job-creation, government revenues and resource mobilisation to finance SMEs. A technical assistance package of up to $730,800 was also provided to BRD by the Fund for African Private Sector Assistance (FAPA) by Japan, the AfDB, the Austrian Development Bank and Austria to reinforce the bank’s internal operational structures and systems. The grant aims to improve BRD’s staff skills, information technology systems, appraisal systems, treasury and financial management, operations, credit risk management and internal controls. Speaking after the signing ceremony, Kayonga lauded the good co-operation between AfDB and BRD. “The agreement, which has just been signed, illustrates the vitality of this cooperation which will enable BRD to be engaged in a programme of reinforcement of its private sector and SMEs operations in Rwanda,” said the BRD chief executive. Emmanuel Murangayisa, the BRD director of finance, added that: “This grant will contribute to optimising BRD management capacities, enabling the bank to enhance performance.” Makonnen thanked the Japanese and the Austrian governments and people for their contribution to boost the private sector development in Rwanda. “The AfDB line of credit and the FAPA technical assistance are aligned with AfDB’s private sector operational priorities for long-term financing to support private sector development, especially where long-term financing is scarce. This programme will enable BRD to respond effectively to the challenges of developing and promoting the private sector and SME development Rwanda,” Makonnen said. Through FAPA funds, AfDB has initiated a broad programme for institutional capacity building to support African development finance institutions such as the West African Development Bank, the East and South African Development Bank (PTA Bank), the East African Development Bank, the Bank Congolaise de l’Habitat and Shelter Afrique, which specialises in housing finance in Africa.

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Rwanda Development Bank gets $8m to fund SMEs