Source: The New Times (Rwanda).
Original article available here.
KIGALI, RWANDA, March 19 – Microfinance institutions (MFIs) in Rwanda are in discussions with the central bank and Simtel to be integrated into the electronic financial transactions.
If allowed, MFIs’ clients will have a chance of making financial transactions using automated teller machine (ATM) cards. The service is currently offered by commercial banks.
The move is aimed at helping the MFIs serving thousands of Rwandans to provide a wide range of affordable financial services that are convenient and flexible to clients.
Françoise Kanimba, governor National Bank of Rwanda (BNR) said discussions are in advanced stages and that they are persuading large MFIs to adopt the status of microfinance banking.
Kanimba said that this will enable MFIs to fully participate in the national payment system.
The MFIs to be integrated into the national payment system will have to enter into a partnership agreement with commercial banks that have shares in Simtel, Rwanda’s only electronic transaction provider.
In the new structure of Simtel, commercial banks’ share holding in the company will be reduced to 24 percent. BNR will hold 18 percent while the new majority shareholders are African Development Corporation (ADC) with 70 percent.
According to the monetary policy statement released by the central bank recently, MFIs showing satisfactory performance in the areas of governance, consolidation of their equity capital, positive operational profits and able to produce reliable accounting and management information will be considered.
Government has now become conscious about the microfinance sector in the country after realising that it is weak.
This is evident by the fact that eight of them where closed in 2006 and another one faced closure last year.
The governor said that government is also focusing on improving the quality of information provided by MFIs. Government also intends to increase capacity building through training directors and managers of MFIs. It also aims at putting in place refinancing facilities for MFIs that have attained secure management standards within the framework of financing the activities that have significant impact on poverty reduction.
Kanimba said that the ministry of finance is set to sink RWF 1 billion (USD 1.8 million). The World Bank has promised to contribute USD 650,000 (RWF 354 million).
By John Gahamanyi, The New Times.
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