The Chamber of Deputies on Thursday, September 10, approved a draft law authorising the ratification of an $80 million loan (about Rwf136.8 billion) from the World Bank's International Development Association (IDA) to support businesses affected by financing constraints. The loan agreement was signed in Kigali on June 25, 2026, under a project designed to strengthen the capacity and resilience of business. ALSO READ: Govt approves Rwf5 billion scheme for SME growth The bill was passed by all 76 MPs present during the plenary session on Thursday. The Minister of Finance and Economic Planning Yusuf Murangwa, who presented the bill, said the Financial Inclusion and Resilience for Enterprises support project was launched in 2021 following the economic disruption caused by Covid-19. He noted that the pandemic affected businesses, particularly micro, small and medium enterprises (MSMEs), and their ability to access financing. He said the initial financing had generated demand from more businesses that meet the project’s eligibility requirements, prompting IDA to provide the additional funding. ALSO READ: Lower House approves Rwf500bn financing to drive job creation “The project has helped many businesses, but we continue to receive applications from businesses that meet the requirements but need additional financing. In response, IFAD agreed to provide Rwanda with this additional loan,” Murangwa said. The loan will be repaid over 40 years, including an 11-year grace period, with zero interest. Implemented through the Development Bank of Rwanda (BRD), the project has three main components: expanding financing opportunities for businesses, reducing lending risks and strengthening the capacity of institutions involved in its implementation, Murangwa said. ALSO READ: Parliamentarians push for small and medium enterprises funding The risk-reduction component includes mechanisms to help businesses secure short-term loans without relying on traditional collateral, while the institutional component focuses on implementation, monitoring and assessment to ensure the project remains sustainable. MP Ingrid Marie Parfaite Izere said the expanded financing options could support private-sector development, but questioned how the project would help businesses survive beyond the initial financing. She cited figures presented by the Minister of Public Service and Labour during a discussion on the annual report of the National Commission for Human Rights, which showed that 90.1 per cent of private-sector institutions are informal and 35 per cent do not survive the first year. Many others, she said, close within two to three years. Izere asked how businesses, particularly those in the informal sector, would be supported to remain operational and grow. Murangwa said the government was combining financing with business management support to address weaknesses that contribute to business failures. He said many informal businesses operate on a small scale, with limited investment and management capacity. Through BRD, operators receive capacity-building and counselling to improve financial management, including separating business and personal finances. The government also supports business operators to form cooperatives, which can strengthen their ability to work together. Murangwa cited businesses involved in animal products, leather and carpentry as examples.
