Rwanda is seeing a surge in the uptake of mobile loans, driven by rapid growth in mobile money usage and a shift toward more accessible digital financial services. The country saw a leap in digital finance uptake from 30 per cent of adults in 2020 to 73 per cent in 2024, largely due to mobile money integration, according to the FinScope Survey 2024. Mobile wallet users grew from 60 per cent of adults in 2020 to 77 per cent in 2024 (about 5.8 million people). A quick review of existing products on the market shows that financial institutions currently offer a wide range of mobile products from microloans as low as Rwf 5,000 to consumer loans of up to Rwf 1,000,000. The flexibility and speed of these services are among their biggest attractions. Interest rates vary depending on the provider and loan size. Short-term loans often come with flat fees, while longer-term products apply annual rates ranging from 9 per cent to 18 per cent. Most require minimal paperwork, often just a mobile banking registration making them especially accessible to the general public. ALSO READ: Majority of mobile loan borrowers are youth–credit bureau Aline Uwase, a fruit vendor in Kigali, says MoKash, a short-term loan service available via MTN Mobile Money, gave her the financial breakthrough she needed to launch her business. “I had always wanted to start a small fruit shop, but getting the full amount was really difficult. A friend told me about MoKash, so I started saving. After saving up to Rwf 50,000, I was able to qualify for a loan of Rwf 250,000, which was exactly what I needed to get started,” she said. Uwase said it was MoKash’s quick approval process, the absence of collateral requirements, and the fair interest rate, especially for a first-time borrower like herself, that convinced her to give it a try. “It was a game-changer for me. I didn’t need to go through long bank procedures or bring in documents. Everything was done through my phone, and within minutes, I had the money,” she said. Chantal Mukamana, another small-scale entrepreneur running a small tailoring business in Musanze District in the Northern Province, says mobile loans played a crucial role in helping her grow. “I used a mobile loan to expand my home-based tailoring business by hiring extra help and purchasing better materials. This financial support not only increased my income but also boosted my confidence as an entrepreneur,” she said. ALSO READ: Rwandans to apply for loans on mobile phones Race to develop more products Financial institutions have been competing to develop mobile loan products that cater for the needs of many Rwandans who cannot afford to go through the lengthy bank processes and paperwork. BPR Bank Rwanda, for instance, operates ‘Mobi-Loan,’ a service that allows customers to borrow amounts ranging from Rwf 5,000 to Rwf 1,000,000 directly through mobile banking. The loan is disbursed instantly, with a short repayment term and a simplified application process without need to visit a branch. According to Andrew Tushabe, Senior Manager of Mobile Payments, Lending & Internet Banking at BPR, the product has gained popularity, especially among salaried workers and small business owners who need quick access to funds, “We joined the mobile lending space because we recognised it as a convenient way to serve our clients and it's growing rapidly in popularity,” he said, adding that with Mobi-Loan eligible users can also apply for top-up loans within their approved limit during the loan term.. The loan carries a flat interest rate of 5 per cent, a one-time facility fee of 2 per cent, and no management fee. “Their repayment capacity should be at least 50 per cent of their account turnover. The good thing is, many customers repay using salaries that come later in the month.” Equity Bank Rwanda, on the other hand, offers mobile loans through its EazzyLoan. This service allows Equity Bank’s customers to access instant loans on their mobile phones, and can borrow as much as Rwf500,000. Jean-Paul Nkurunziza, a university student in Huye District in the Southern Province, said that the access of EazzyLoan from Equity Bank has made his student life more manageable. “As a student, I used to struggle with daily expenses, especially when our living allowance was delayed. Now, whenever I need money, I can borrow a small amount through mobile banking, and it’s automatically repaid when my allowance is deposited,” he noted. Despite these advancements, the FinScope 2024 survey noted a decline in the proportion of credit-active consumers, from 76 per cent in 2020 to 63 per cent in 2024. Factors contributing to this decline include concerns about repayment capacity, limited collateral, and stringent lending requirements.
