Refugees in Rwanda gain access to finance

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Minister Mukantabana speaks at the meeting yesterday. / Timothy Kisambira

A new project that financial experts say will help refugees become economically self-reliant was launched, yesterday, ahead of the World Refugee Day due today.

The project will consist of grants and loans that will be provided toward refugees’ projects in form of revolving funds so that refugees in camps in Rwanda benefit from them effectively, according to the Minister for Disaster Management and Refugees, Seraphine Mukantabana.

The minister said, of the estimated 160,000 refugees in Rwanda, 80,000 were active and were able to carry out profitable business.

The minister noted that the move was intended to make refugees get financial and business management skills that would enable them run business and revolutionise the traditional aid to refugees.

“The essence of the project is that refugees should not sit in camps all the day waiting for the monthly aid of maize and beans or any other support. We want refugees to work, and use their knowledge and energy to improve their livelihood and contribute to the development of their communities,” she said.

Mukantabana said a refugee gets about Rwf7,000 a month [in lieu of food support], but that the new initiative could help them benefit from income-generating activities, including arts and crafts, tailoring and shoe making, which can enable them earn Rwf100,000 a month or more.

The initiative is in line with the Government and UNCHR’s refugee empowerment strategy launched in September 2016, to help refugees become self-reliant.

The UNHCR country representative, Saber Azam, said the development is also part of the commitment of Rwanda, during the recent leaders’ summit in New York, to allow refugees to become an integral part of the socio-economic development of the country.

Among the financial services that refugees need are savings and credit, financial transactions, and insurance.

The partnership is being led by Financial Sector Deepening Africa (FSD Africa), and Access to Finance Rwanda (AFR).

During the pilot phase, FSD Africa will offer grants amounting to £30,000 for product development and launch for three most innovative and impactful new financial products for the refugees.

The Director of Regional Strategies at FSD Africa, Joseph Huxley, said a thorough study on the financial service needs for the refugees is expected to be completed in September.

After the pilot phase, Huxley said the firm will provide £300,000.

At least $20 million was needed to support the first phase of refugees’ lucrative projects start production, Mukantabana said.

Refugees present market opportunity

Azam said the global refugee market is estimated at $10 billion, yet UNHCR’s [annual] budget is $5 billion.

In 2016 alone, about $94 million was spent on refugees’ welfare in Rwanda.

“If a sizeable number of refugees are working, he said, then the output of their work, the taxes that they will be paying would be additional money to the economy,” Azam said.

He added that a basic survey that they (UNHCR) have carried out, projected that refugees could bring in up to $450 million to $500 million if they are given opportunity to be self-reliant.

“And this is what the Government of Rwanda is doing and this is great,” he said, calling for financial innovations from financial institutions to make use of the opportunities among refugees.

Mukantabana said there were about 18 projects in line with development and refugees’ self-reliant that were selected. There are also companies that will implement them.

They started with women engaged in weaving baskets, people making shoes, and those involved in adding value to agricultural produce through processing.

Huxley said financial services that were extended to refugees previously were not affordable, noting that the new financial packages are designed in such a way that refugees will receive their money through their phone, such as via MTN mobile money and Tigo cash wallets.

This development, he said, will make it cheaper, convenient and time saving for refugees to receive their money or make financial transactions.

Ami Niragire, camp planner and sports and youth coordinator at Gihembe Refugee Camp in Gicumbi District, said refugees face challenges in access to finance, such as lack of formal refugee Identity cards.

Mukantabana said most of the refugees have identity cards, but, that the new caseload Burundian refugees have not yet received them, noting that some refugees also need to renew their IDs.

She pointed out that a registration verification exercise will be carried out to identify legitimate refugees and give them IDs so that they enjoy financial inclusion.

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