The World Bank Group (WBG) through its international financial institution, the International Finance Corporation (IFC) penned a two year $0.5 million deal with I&M Bank Rwanda Limited.
The advisory project, the first for IFC seeks to increase financial access for small and medium enterprises (SMEs) in Rwanda.
According to the Rwandan Ministry of Trade and Industry, 98 per cent of businesses are considered SMEs, contributing 41 per cent of all private sector jobs as of 2016 survey. The country has over 72,000 MSMEs which are a source of employment to the citizens. The enterprises also contribute more than half of the total gross domestic product.
I&M Bank Managing Director, (Rwanda) Robin Bairstow said, ” By working with IFC to build strong banking products for small business customers, we will reach more SMEs to drive growth in the country.” The partnership aim is to finance the SMEs and help them achieve their potential in a competitive business environment.
Manuel Moses IFC Country Director added, “SME finance is an important tool to create jobs. It’s not just about making more finance available; it’s about creating opportunities for small businesses to thrive.”
The project targets women-owned enterprises that are underserved and fail to access funds to finance their projects. The role of women in the society and business world to contribute to the country’s economic growth is vital. Gender parity is equally important to give them a chance to make a positive impact on their generation.
Riadh Naouar, Manager for Financial Institutions Group Advisory in the Middle East and Africa, said: “When we work with partners to increase small business access to finance, we build strong businesses that can create jobs and drive economic growth.”
IFC has played a fundamental role in Rwanda’s economy from creating new sources of capital to investing in primary sectors in the country such as agriculture, particularly in the coffee industry. The organisation has invested in education and supported women entrepreneurship efforts in the country.
Rwanda jumped an impressive 76 places – from 143 to 67 – on the World Bank’s Doing Business 2010 report, becoming the first African country to top the list as the world’s biggest business reformer, courtesy of World Bank and IFC support.
One of the notable changes was the reduced number of days to start a business. A Rwandan entrepreneur takes now 48 hours to establish a business. The latter, IFC, continues to build a strong relationship with the landlocked country to reduce poverty and better its economic outlook.
At the beginning of the New Year, IFC invested $10 million for lending to the small businesses. “The project will improve access to finance for SMEs and the agri-business sector, both priority areas for spurring economic growth and job creation in Rwanda,” IFC disclosed.