COMMERCIAL Banks and other financial institutions have been urged to work with community savings groups as part of efforts aimed at deepening formal financial inclusion.
National Bank of Rwanda (BNR) Deputy Governor Monique Nsanzabaganwa made the call yesterday saying the move will help create strategic linkages between financial institutions and unbanked members of the public.
She was speaking at a forum organised by Access to Finance Rwanda in collaboration with a global learning network, SEEP.
Over 400 participants representing 205 organisations and 50 countries are participating.
She said that savings groups not only help provide regular income and savings platforms, but they also enable members access credit.
“Savings groups are not just about financial services but holistic development and well being of members and their livelihoods,” she said.
Nsanzabaganwa added that, currently, savings in Rwanda are still low, at around 13.8 per cent, while the target is around 30 per cent in next 3 to 4 years.
Government of Rwanda is looking to savings groups to drive up savings levels in the country. There are currently about 36000 savings groups in Rwanda,” Nsanzabaganwa said.
According to Waringa Kibe, the Country Director of Access to Finance Rwanda, the organisation will continue to contribute to deeper and more inclusive financial sector to have more impact on the livelihoods and well-being of low income earners.
She added there is a need to have more savings groups as it is an opportunity to engage with organisations as well as technology service providers to learn about innovative products and services.
However, Waringa said banks and Saccos have to look at the rural market as a growing market and work with savings groups to improve access to finance in those areas.
“Creating digital platforms makes it simple to manage savings groups and encourages their development, including security of funds, financial education and establishment of trust between the groups and formal financial institutions, which enables them to access loans,” she added.
Sharon D’onofrio the Executive Director of SEEP network, encouraged greater use of wide range innovative session structures and methodologies that build on emerging and accepted best practices in learning in the process of innovation.
Aimable Nkuranga, the Executive Director to Association of Microfinance Institutions in Rwanda (AMIR), said there is need to increase financial education to boost initiatives geared at deepening formal inclusion.