A United States funded project Hinga Weze has entered into a deal with Equity Bank to start offering loans worth Rwf2, 5billion to farmers, cooperatives, aggregators and agro dealers.
The deal was sealed by both parties on Tuesday afternoon in Kigali and is expected to benefit specifically farmers involved in Irish potato, horticulture, maize and poultry value chains.
In the deal, 110 agro-dealers will access credit worth Rwf220m, 5 aggregators are expected to receive credit worth Rwf1.5billion, while 25 farmer’s cooperatives will access Rwf300m, and 5,000 farmers, Rwf500m.
Through the same partnership, 10,000 farmers and 50 cooperatives will be trained in post-harvest handling, storage techniques, good governance and financial literacy as a way of supporting the sector which has been affected by the New Coronavirus crisis.
According to the National Institute of Statistics (NISR) Rwanda registered a 3.6% GDP growth in the First Quarter (Q1) of 2020, a slow down due to COVID-19 compared to 9.4% growth in 2019 and the agriculture sector taking a hard hit- dropping by -1% (-2% for food crops and -12% export crops).
NISR report released on June 20, 2020 stated that Rwanda’s Q2 GDP this year will be mostly affected and a recovery is only expected in Q3 and Q4.
With only two years left in its mandate, the US-government funded Hinga Weze has so far entered into partnership with 25 financial institutions including Kenya Commercial Bank, Micro finance Institutions and Savings and Credit Cooperatives (SACCOs).
It has facilitated access to Rwf3. 5billion ($3.8m) of value of agriculture loan out of $5.6m as value of agriculture-related financing expected to be accessed in five years.
About 41,552 farmers have also participated in microfinance and lending programs, out of 63,746 farmers targeted by the program in five years since 2017.