BRD, FSA sign deal to support small businesses

The rwanda Development Bank (BRD) and African Solidarity Fund (FSA), a multilateral financial guarantee institution, have signed a deal that will see more small-and-medium enterprises (SMEs) get loan guarantees, long repayment schedules and borrow at low interest rates.“Most firms need long loan repayment periods so that they can grow and FSA has the capacity to support such an arrangement,” said Alex Kanyankole, the BRD boss, after signing the deal on Friday.“This deal will help create jobs for the youth as they will be able to access finance to start businesses. It also puts us in a better position to seek funding from development finance institutions across the world,” he explained.FSA operates like the Business Development Fund that was instituted by the government in 2011. The Niger-based African Solidarity Fund operates in 13 countries, including Rwanda, Benin, Burkina Faso, Burundi, Central African Republic, Ivory Coast, Gabon, Mali, Mauritius, Senegal, Chad and Togo.It aims at facilitating economic development of its African member states. It also facilitates the mobilisation of local and foreign savings, including interventions guarantee in the financial markets.Kanyankole pointed out that FSA had played a big role in the establishment of Minimex, a local maize miller, Green Hills Academy and hydro-power plants in Nyaruguru district in the Southern province.“Our intervention will enable BRD acquire financial security to extend more loans to entrepreneurs. We look forward to ensuring that SMEs and micro-finance institutions access to finance,” said Pierre Yaovi Sedjro, the FSA director general.Yaovi said the deal would see both parties jointly identify, monitor and evaluate projects to be financed in the country since SMEs constitute 85 per cent of Rwanda’s economy.He added that the agreement was a win-win for both institutions and would see them bridge the gap between financial institutions and entrepreneurs seeking funding.

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BRD, FSA sign deal to support small businesses