KCB Bank Rwanda has secured $10 million (about Rwf8 billion) loan from the International Finance Corporation (IFC) to support the country’s housing sector and small-and-medium enterprises (SME).
Maurice Toroitich, the KCB Bank Rwanda managing director, said the money will strengthen the lender’s capacity to increase long-term funding to the SME and housing sectors.
The bank had previously got funds from IFC to support agribusiness, and Toroitich said there was need to finance other sectors. “The funding will help us provide affordable mortgage facilities and long-term lending to SMEs,” he said.
The bank recorded Rwf3.2 billion pretax profits last year, an increase of 165 per cent from Rwf857 million in 2014.
KCB Bank Rwanda is currently funding development of Century Park Complex, a $200 million (about Rwf145 billion) project undertaken by Century Park Limited, in Kigali. The complex will house 200 apartments, 16 villas, supermarkets, and two five-star hotels.
Rwanda seeks to ease a growing housing demand driven by urbanisation, with 30,000 units required Kigali annually. Access to affordable long-term funding is one of main issues affecting the growth of the SME sector.
Trade and Industry Ministry statistics show the sector (both formal and informal enterprises) comprises 98 per cent of the total businesses in the country, accounting for 41 per cent of private sector jobs.
The two sectors that will benefit from the IFC funding are growth drivers for Rwanda.
“The loan will provide dollar funding for the bank to support long-term needs of SMEs, as well as local currency-based finance to increase mortgage lending,” IFC said in a statement.