MUSANZE — The Governor of Rwanda National Bank (BNR) has allayed fears that the new savings and credit cooperative SACCO Umurenge will eliminate existing microfinance institutions.
Francois Kanimba explained that the SACCO Umurenge will serve to complement the existing microfinance institutions by promoting the culture of saving by further expanding the existing national micro financial institutional framework.
He was on Monday speaking during a public lecture on monetary and financial stability which he delivered at Ruhengeri Institute of Higher Education-INES.
Kanimba noted that residents have the right to choose which bank or micro financial institution to use.
Micro finance institutions, in the rural communities are currently experiencing some sort of a crisis after losing many of their traditional clientele to the new Umurenge SACCO outfits.
The governor reiterated that BNR introduced medium and long term refinancing facility to allow the local banking system to borrow more from the central bank. Consequently Kanimba challenged the local banks to start lending out to the public.
On the financial sector state of affairs Kanimba explained that as at the end of June 2009, the net profit after tax was approximately Rwf3.6 Billion , compared to Rwf7.2 Billion in June 2008. He attributed the drop in sector earnings to the global economic meltdown.
On the economic outlook, Kanimba said that there has been a slow down trend in imports since the second quarter of 2009, adding that domestic saving mobilisation will be critical in the mid term in order to sustain an envisaged high growth rate.