Development Bank of Rwanda (BRD) has signed a Rwf1.5 billion guarantee facility with the African Solidarity Fund to support development projects in different sectors of the economy. 

The BRD chief executive, Alex Kanyankole, said the facilitate will be used to support small-and-medium enterprises (SMEs) with medium to long-term projects in the real estate, energy, and education sectors.

He said Rwf500 million of the money will be used to provide guarantee for commercial building projects, micro hydropower plants will get Rwf370 million, while Rwf345 million is for developers of a modern market complex, and a nursery and primary school venture will get Rwf291 million under the deal. African Solidarity Fund facilitates investment projects that support economic development among its member states, as well as those that create more jobs and help reduce poverty.

Speaking after the signing of the deal in Kigali last week, Ahmadou Abdoulaye Diallo, the African Solidarity Fund director general, said the agreement aimed at leveraging the Fund to support the development of Rwanda’s private sector through provision of financial security.

"The guarantee facility will ease risk and enable the investors acquire loans they need to develop their projects and create more jobs for Rwandans,” he said.

The deal also provides for an extension of loan repayment period "to allow the projects identified access financing and kick-start them”.

Abdul Gahima, the founder of Good Harvest School and one of the beneficiaries, said the guarantee will enable him acquire finance to put up modern infrastructure at the institution, adding the extension of repayment period will ease pressure on borrowers.