The Capital Market Authority (CMA) will this afternoon launch this year’s edition of the Capital Market University Challenge. The competition, which has attracted over 1,200 students from 210 clubs of different universities countrywide this year, seeks to deepen understanding of the capital market sector and also encourage Rwandans particularly students and other young people to invest and save through the local bourse, among others. CMA acting executive director Eric Bundugu explains more about the annual contest, its achievements and more in an interview with Business Times’ Nuwagira Stephen. Excerps;
You will be launching the 5th Edition of the Capital Market University Challenge later today. What is this competition all about and who are the targeted groups?
The fifth edition of the Capital Market University Challenge is a three-week competition that tests the contestants’ knowledge of capital market. It will have two categories of activities; there is the quiz category, where the competing students are tested on their knowledge of the capital market industry.
The second category is essay writing on the theme, “The role of youth in saving through capital market”. The competition is open to only undergraduate students in universities and other higher learning institutions across Rwanda. It will be launched today and activities will end on March 26, 2018 with the announcement of the overall winners for both categories. The launch will be held at the University of Rwanda’s College of Business and Economics (UR-CBE) at 2pm.
What should participants in this year’s challenge expect?
This year, we expect to get more participants compared to previous editions. Therefore, this edition of the competition is better and bigger and stakes are high because we have increased the prize money for the winning teams. Up to Rwf1.2 million is up for grabs for the overall winners, while other cash prizes have all been increased. So, we expect more competition and following.
Do you keep track of students who participate in the competition, especially those that win? How are they performing presently?
We follow up on all the winning teams to guide them on their new journey as investors, savers and young business owners. All the winners get cash awards, but in the form of shares of some of the firms listed on the local exchange.
According to reports from our follow up exercises, some of them are doing well. There are some success stories here and there. For instance, there is a savings club at the University of Rwanda, Huye campus that was formed by six students. The members have been contributing Rwf3,000 each per month since February 2017. This group was part of last year’s competition and was among the top four winners awarded Rwf1.1 million in both essay and quiz competitions.
Later, with an initial capital of Rwf1.5 million, the team decided to register a company called Brave Statistical Analysts Group (BSA) which has since trained 120 university students in using statistics software like Data pro.
This is a clear indicator that the Capital Market University Challenge is having real impact among the targeted group, and we believe this will create a multiplier effect since they have friends and family.
How is the competition helping to deepen stock market activities and encouraging investment and savings on the local exchange by the young people?
The Capital Market University Challenge is part of our public education campaign. It is aimed at introducing the youth to the capital market and the culture of saving while they are still at college.
We also aim to interest them to the industry as future professionals. In addition, students who participated in the previous competitions have come up with great ideas to start saving and investing through the capital market.
Therefore, I can authoritatively say that the Challenge is enabling more and more young people, especially students, to become active participants in the capital market activities as investors and professionals.
Investment clubs are not common in Rwanda. What is holding back the development of such clubs?
We cannot say that they are being held back… In fact, there are many savings and investment clubs right from primary school level to the various higher learning institutions across Rwanda. To support the development of these clubs and make them sustainable, CMA plans to start a training programme for them in June this year.
Why should young people, particularly students, invest or save with the stock exchange?
Young people should embrace the savings culture if they are to become “committed and focused” investors in future.
The Capital Market University Challenge is actually targeted at the future beneficiaries of the capital market. The aim is to introduce and capture students as the future workers and earners. As it is said, it’s always better to catch them young. That way, you are sure to create and mentor a new generation of people that are biased toward the industry as investors, professionals and other stakeholders.
How many student investment groups (if any) are investing in the capital market?
So far, all winners of the Challenge have shares in some of the firms listed on the stock market. On average, they are currently 50 clubs from the previous competitions investing through the exchange.
What is your advice to the youth as far as saving is concerned?
Young people should start saving early to accumulate money overtime. Through this process, they will be able to learn the importance of saving and financial discipline and, hence, secure their financial future. Besides, government targets a national savings ration of 20 per cent to GDP, which can only be achieved through concerted efforts by all Rwandans, including young people.
Do you have any parting message for Rwandans?
This year’s challenge will be bigger and better as it will attract thousands of students from various universities across Rwanda. As participating students showcase their knowledge of the capital market industry through an interactive competition, they need all the support they can get from family members, teachers and everyone else.
The competition is also an opportunity for all Rwandans to gain more understanding of the industry.
In addition, all of us should remember that it’s never too late to start saving or investing; let’s take advantage of the many savings or investment vehicles available, like the Rwanda Stock Market, government bonds and RNIT Iterambera Fund, to safeguard our future and also support the country’s drive toward self-reliance.