VIDEO: Govt in search of investor to set up cooperative bank

The government is seeking an investor to set up a co-operative bank. According to the Minister for Trade and Industry, Francois Kanimba, government wants to partner with a strategic investor in the venture to fast-track its implementation. He said the bank will help grassroots based savings and credit institutions, commonly known as Umurenge Saccos, upgrade status to boost access to finance by small-and-medium businesses. VIDEO: Rwandas economy focus on Industrial Sector in 2015. Source: The New Times/ YouTube Kanimba, who was addressing reporters in Kigali, on Wednesday, said establishing such bank requires an initial deposit of Rwf5 billion. “Under the arrangement, Umurenge Saccos will raise 60 per cent of the capital, while the remaining 40 per cent will be provided by the strategic investor,” Kanimba said. Therefore, the challenge is to indentify an investor before the end of the year to kick-start the venture, he added. The plan is for Saccos to remain with their legal structure and agree on how the central bank can empower the envisaged cooperative bank to take on the leadership role of these institutions, the minister added. Damien Mugabo, director general Rwanda Cooperative Agency, said the agency is in the process of computerising systems before the bank is established. “We are encouraging all Saccos to register online so as to enhance efficiency and transparency.” We are ready and confident that we will be able to raise the money given our deposit status, he added. The micro-finance sector in Rwanda is comprised of 493 institutions, including 13 limited companies and 480 Saccos, of which 416 are Umurenge Saccos serving more than 1.8 million clients. The sector plays a critical role in fostering economic development by offering financial services, particularly loans and opportunities for savings to people with limited access to commercial banking services. Its total assets grew by 19.5 per cent, from Rwf126.2 billion in September 2013 to Rwf 153.87 billion at the end of September last year. Total deposits increased by 21.6 per cent during the period, from Rwf 69.64, billion to Rwf 84.5 billion while gross loans increased by 18.4 per cent, from Rwf72.53 billion to Rwf87.03 billion. editorial@newtimes.co.rw

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VIDEO: Govt in search of investor to set up cooperative bank