Rwanda: Stock Exchange partners with two banks to offer cheaper loans to farmers

Dec 10, 2014

Grain farmers will soon be able to acquire loans at affordable rates in Rwanda after the signature of an agreement between the East African Exchange (EAX), Banque Populaire du Rwanda and Ecobank.

Grain farmers will soon be able to acquire loans at affordable rates in Rwanda after the signature of an agreement between the East African Exchange (EAX), Banque Populaire du Rwanda and Ecobank.

Alfa Kadri, head of the commodities exchange, told the New Times the banks are already developing loan products targeting farmers who use the firm's warehouse receipt system under co-operatives.

He added farmers will be able to acquire short-term credit from the banks of up to 70 per cent of the value of their produce at interest rates of between eight and 20 per cent.

EAX currently deals with over 5,000 small-scale maize and bean farmers from 28 co-operatives. Farmers are issued receipts that can be used to trade on EAX's Nasdaq platform or as a security to acquire loans and repay after selling their produce.

Through the initiative, Alfa Kadri expects that agricultural loans will account for 20 per cent of total bank loans by 2019, up from 10 per cent currently.ADNFCR-2976-ID-801765122-ADNFCR