Written June 2012
In association with the Rwanda Agro-Dealer Development (RADD) project and the Alliance for a Green Revolution in Africa (AGRA, which is funding RADD), Equity Bank met in April 2012 with 30 agro-dealers in Rubavu District and presented information on business loans and other products available through the bank. After the meeting, all attending agro-dealers opened bank accounts at Equity Bank’s Rubavu Branch and began the process of applying for business loans.
The meeting helped fulfill RADD’s second objective of improving agro-dealers’ access to finance. RADD is collaborating with several financial institutions; Equity Bank is one of the project’s key partners. According to project officials, agro-dealers generally require improved banking and credit literacy, so RADD continues to train agro-dealers and coordinate with the financial institutions that support them. To further formalize dealer access to business loans, RADD is seeking options to develop a risk-sharing fund – or guarantee fund – for the agro-dealers it supports across Rwanda.
Left: The RADD project coordinator and Equity Bank’s loan officer visit agro-dealers in the Bugeshi and Kanama sectors of Rubavu District, Rwanda. Right: The RADD project coordinator and Equity Bank’s loan officer visit agro-dealers in the Bugeshi and Kanama sectors of Rubavu District, Rwanda.
As part of the approval process, agro-dealers are required to submit a business plan with the loan application. RADD’s project leader and an Equity Bank loan officer are working directly with the trained agro-dealers who have submitted their business plans and loan applications to assess their business qualifications and evaluate whether their applications fulfill bank requirements.
Equity Bank’s branch manager stated that the bank is willing to invest in agro-dealerships, and he is hoping that the bank’s positive experience in Kenya can be customized for Rwanda. He added that it is good business for Equity Bank, and a positive way to promote agriculture in Rwanda.
RADD project officials state that they are pleased to be working with partner financial institutions, and in particular Equity Bank. Project staff will continue its efforts to build the credit literacy of Rwandan agro-dealers, and collaborate with participating banks and Rwanda’s Private Sector Federation/Business Development Services (PSF/BDS) to support agro-dealers in their pursuit of acquiring bank loans to support their business operations. According to RADD staff members, these efforts and their outcomes will be the foundation of the proposed agro-dealer guarantee fund.