For Norah Kamashazi, growing her maize seed multiplication-centred small and medium enterprise was always an unmet goal, mainly because she could not secure a bank loan to that end.

But with the support from a project that came under the Nguriza Nshore Activity, the woman was able to get financing which enabled her to more than double her business size – as it addressed the exigent bank loan requirements such as collateral.

Kamashazi who is in maize seed multiplication business in Nyagatare and Gatsibo districts of Eastern Province, is among the beneficiaries of the nguriza nshore project.

The project was funded by the United States Agency for International Development (USAID) as part of Feed the Future – the U.S. Government’s global hunger fight and food security initiative.

On March 17, while in Kigali, USAID celebrated the conclusion of this five-year $14.9 million project which helped grow small businesses in the agricultural sector and created non-farm jobs for rural Rwandans.

Feed the Future Rwanda Nguriza Nshore, in close collaboration with the Rwandan Ministry of Trade and Industry, used a market systems approach to assist bank and non-bank financial institutions to develop strategies for lending to SMEs, facilitate private investment, and strengthen the business-enabling environment to drive SME growth and create non-farm jobs for rural Rwandans.

Women, youth, and people with disabilities were a special focus of Nguriza Nshore’s efforts.

Addressing banks’ reluctance to lend to farmers, agri-SMEs

Kamashazi said that banks were requiring collateral that was double the value of the loan a farmer or agribusiness SME wants to get, which was prohibitive.

The project, she said, intervened by covering half of the required loan security, with the beneficiary only paying half of the guarantee.

In the first disbursement made last year, she received Rwf30 million (about $30,000) from one of the banks in Rwanda, which she paid off in the same year.

This year, she received another loan of Rwf45 million (about $45,000).

The money she got helped her more than double her acreage from between 15 and 20 hectares to 50 hectares, and triple farm output from 1.5 tonnes of maize per hectare to 4.5 tonnes of maize per hectare.

"My income also increased because I raised the tonnage of maize I sell,” she said, indicating that she got the loan charged at 16.5 per cent annual interest rate under the project, as opposed to the usual 18 per cent.

Such a progress, she said, resulted from running farming practices, including buying quality seeds and fertilisers needed for improved yields, paying casual labourers who take care of her farms and crops, and proper harvest handling. All this was achieved because of the help from the project.

Exceeding, by far, activity objective targets

Its objectives were to increase lending for off-farm SMEs by $15 million, increase investment in off-farm SMEs by $30 million and support policies that enhance SME access to finance, as well as create 30,000 non-farm jobs.

Project results include $64 million in financing for SMEs in the agribusiness sector – or four times the target; $33 million in leveraged investment equivalent to 110 per cent of the envisaged amount, and 41,000 new jobs created, or 136 per cent of the target.

Nguriza Nshore Chief of Party, Lee Rosner, said: "We are proud of the numbers we have been able to deliver.... There are 41,000 people that now have jobs, which they did not have before, the large levels of investment from financial, bank and non-bank institutions, as well as private investors.”

On the implications of such financing achievement, he said "there are people with resources that are interested and willing to invest in Rwandan small businesses because they think they can get good return on their investment.”

Masaka Creamery CEO, Luke Lundberg Murray, said that Nguriza Nshore helped the firm with many things, mainly marketing strategy, and also financial readiness to attract investors, adding that such support helped them to grow their company.

Part of this dairy processing firm’s mission, he pointed out, is to provide opportunities for Rwandan youth with disabilities, indicating that majority of those it hires are Rwandan youth with hearing impairment.

"And so, when we started with Nguriza Nshore in 2019, we had 40 employees, 25 of them who were deaf youth, and today we have 38 deaf youth out of 55 employees,” he said.

The USAID Rwanda Mission Director, Jonathan Kamin, said that the agency will continue to uphold the gains achieved by Nguriza Nshore, and to support Rwandan Government, financial institutions, SMEs and smallholder farmers.

"USAID will continue to build linkages between more smallholder farmers, agribusiness enterprises and financial institutions to increase investments and profits for the producers, therefore improve livelihoods in rural areas,” he said.

The Permanent Secretary of the Ministry of Trade and Industry, Richard Niwenshuti, said that Nguriza Nshore’s interventions were well in line with the Government of Rwanda’s national strategy for transformation, under which the country targets to create more than 200,000 off-farm jobs per year by 2024, and achieve economic growth chiefly based on SMEs productivity.

"The achievements realised by the project including job creation, increasing investment in agriculture, and supporting SMEs, are good and important actions,” he said, adding that USAID funded other projects that are being implemented to support Rwanda’s agriculture and overall economic growth.

Broader business, financial sector support

Feed the Future Rwanda Nguriza Nshore also worked with the Rwandan Ministry of Trade and Industry to strengthen the business-enabling environment by supporting the design of the Entrepreneurship Development Policy (EDP), assisting the Ministry in officially launching the policy in December 2020, and conducting a series of countrywide Public and Private Dialogues (PPDs).

It helped to remove constraints inhibiting access to finance by these populations and improved their employment prospects.

It also contributed to the Government of Rwanda’s Vision 2050 initiative, envisioning Rwanda as a financial services hub in East Africa.