RWANDA DEVELOPMENT BOARD (RDB) has been working in overdrive to streamline the ease of starting a business in the country.
Many of its reforms have propelled Rwanda into an elite group of countries that have favourable investment climates and safe returns. With the introduction of the online business registration, beginning a business has been taken even a notch higher.
But is that enough?
Is giving a blanket approval to every Tom, Dick and Harry to start a business without scrutiny a smart move? Once in a while the Ministries of Finance or Trade announce the deregulation of a business firm that is discovered to be fleecing the public.
Many of the Ponzi schemes would have been discovered earlier had due diligence been followed. RDB should not just be content with registering businesses; it should also come up with mechanisms that protect the public from financial vultures.
Scrutinising business plans and educating the public can help weed out conmen and “ghost” firms that prey on the gullibility of a public that is easily enticed by the prospect of making a quick buck.
How do pyramid schemes get past the gate man (financial regulators)? They either front a legitimate sounding business and later morph into something else, or someone in the business registration office is sound asleep.
Attracting foreign investors should go hand-in-hand with protecting local investors, many of whom are left holding worthless pieces of paper in exchange for their hard-earned savings.