The government has issued new regulations allowing both local and foreign private firms to operate central securities depositories (CSDs), a move aimed at strengthening the country’s capital market and attracting new players to the sector, according to the Capital Market Authority (CMA).

Published in the Official Gazette on January 16, the Regulations Governing Licensing of Central Securities Depository Operators and Authorisation of Central Securities Depository Participants establish the licensing, operational and supervisory framework for institutions responsible for the custody, transfer and settlement of securities.

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The regulations support the implementation of the 2025 law governing central securities depositories, qualified financial contracts and netting agreements, which repeals the 2010 law that regulated the holding and circulation of securities.

Securities include tradable or negotiable financial instruments such as bonds, stocks, certificates of deposit, treasury bills, promissory notes, bills of exchange, and eligible long-term insurance contracts.

Under Article 3 of the regulations, no entity may conduct CSD activities without a licence issued by the CMA, which is the regulator of the capital market.

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The framework formally places CSD operations under CMA supervision, aligning with Rwanda’s broader objective of developing a well-structured capital market and strengthening its regional role as a financial services hub.

"This step demonstrates Rwanda’s continued efforts to build reliable capital markets. It opens the way for broader participation and contributes to market resilience,” said Eric Karekezi Ngabonziza, the Acting Chief Executive Officer of CMA, in a statement shared with The New Times on January 22.

Article 21 of the regulations requires licensed operators to establish robust internal controls and risk management systems to safeguard the integrity of securities transactions.

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Previously, only the National Bank of Rwanda (BNR) was authorised to operate a CSD. According to the Ministry of Finance and Economic Planning (MINECOFIN), the revision was driven by the need to liberalise CSD operations, attract international operators and align Rwanda’s capital market with global best practices.

The reforms also seek to separate the central bank’s regulatory and operational roles. Under the new framework, CMA assumes regulatory oversight of CSDs, while BNR may continue to operate only as a service provider.

In addition, the law formally recognises repurchase agreements (REPOs), a development MINECOFIN says will improve the handling of securities transactions, particularly in cases of insolvency.

By providing legal certainty, the framework strengthens the enforceability of netting provisions when a party defaults, helping to reduce systemic risk and protect market participants. A REPO—also known as a buyback—is a transaction in which one party sells securities to another with an agreement to repurchase them later at a higher price, effectively functioning as a secured short-term loan.

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The regulations define a CSD operator as the National Bank of Rwanda or any company licensed by CMA to conduct some or all CSD activities in Rwanda. A CSD participant, meanwhile, refers to any authorised institution or entity permitted to open and hold securities accounts with a licensed CSD operator.

Licensing requirements

Private firms seeking to operate a CSD must apply to CMA and meet strict licensing conditions. These include minimum capital requirements, detailed business and risk management plans, strong governance structures, integrity checks for directors and senior managers, anti-money laundering controls, and secure information technology and cyber-risk systems.

Applicants are required to pay a non-refundable application fee of Rwf2 million and demonstrate a minimum paid-up capital of Rwf500 million, while maintaining liquid capital of at least Rwf400 million. Once licensed, operators must pay a licence fee of Rwf1 million and an annual supervision fee equivalent to one per cent of their gross annual revenue.

CMA is required to acknowledge receipt of applications within five working days and issue a final licensing decision within 90 days of receiving a complete application. The authority may grant a full or limited licence, impose conditions, or reject an application, with provisions for appeal.

Speaking in May 2025, Théogène Munyangeyo, Chairperson of Parliament’s Committee on Economy and Trade, said the law was expected to help establish a safe and efficient system for securities investors in Rwanda.

At the time, he noted that securities held in CSDs—including listed equities and government treasury bonds and bills—were valued at about $3.3 billion (approximately Rwf5 trillion), equivalent to 26 per cent of Rwanda’s GDP. About 90 per cent of investors were domestic.

He added that the reforms support domestic mobilisation of long-term investment and align with the government’s goal of strengthening self-reliance in financing.