The Development Bank of Rwanda (BRD) has since last year spent at least Rwf20 billion in the agricultural sector, one of the most prioritized sectors in the country.
This was revealed by Jack Kayonga, the acting Director General of BRD, while appearing on a live talk show on Rwanda Television and Radio that brought together all members of the Rwanda Bankers Association.
Kayonga further said that they have earmarked another Rwf20 billion to disburse in loans for agricultural projects, as a way of boosting the sector that last year registered a landmark 13 percent grown.
He was responding to inquiries that commercial banks in the country have cut on the number of loans given out most especially to the agriculture and livestock projects in the country over the past two years.
He said that the drop in loans directed to these sectors was as a result of inadequate land for most applicants.
“We found that people’s land was not enough to yield high produce that would help them refund the acquired loans,” Kayonga said.
He said the exercise has been made much easier by the introduction of cooperative societies, into which people have been organized and the land consolidation exercise which has led to higher yields.
“It is now easier for them to harvest more produce that would help them pay back the acquired loans in time, which prompted us to release the funds,” he added.
As a way of accelerating the country’s economic development, Kayonga added that the government has for the past four years injected Rwf12 billion in agriculture and livestock sectors through BRD.
Meanwhile, Bonaventure Niyibizi, the President of Rwanda Bankers Association said that high investment levels in the country in the past two years also affected the banks loan sector.
“There have been high levels of long term investments especially in the construction sector over the past years which required big sums of money that led to a drop in the banks’ capital in the short run,” Niyibizi said.
“We have consulted some foreign banks to help us and now we are back on track. But the first priority goes to important projects which are able to bring some positive changes in the country’s economic development,” said Niyibizi, who also heads Cogebanque, a local commercial bank.
Reacting on the new directive by the National Bank of Rwanda (BNR) that there will be no more cash withdrawal above Rwf5 million a day from any commercial bank, Niyibizi said that this was done to curb down robbery risks.
“Many people have been traveling with big sums of money which was putting them on a high risk for being robbed,” he said.
Different members of the business community have decried the new move, saying that it will hinder their business operations.