BNR Governor Soraya M. Hakuziyaremye during the interview
Kigali — The National Bank of Rwanda (BNR) has revealed plans to ensure that businesses and even individuals can protect themselves against rising foreign exchange (forex) costs, by expanding a special currency hedging mechanism currently available only to commercial banks.
In a wide-ranging interview with KT Radio’s Rwanda Behind the Headlines program, BNR Governor Soraya M. Hakuziyaremye explained that the central bank has been offering what’s known as a forex swap facility to commercial banks.
This allows them to secure U.S. dollars from the central bank at a pre-agreed exchange rate, even if the transaction will happen one or two years later. In return, the banks pay a small premium to the central bank for that price stability.
What Is a Hedging Facility?
In simple terms, hedging helps businesses protect themselves from future losses due to unpredictable currency changes.
For example, a company that needs U.S. dollars or euros six months from now can sign an agreement with a bank today to lock in a fixed exchange rate.
Even if the Rwandan franc weakens in the meantime, the company will still buy dollars at the previously agreed rate. This makes financial planning easier and shields businesses from sudden forex shocks.
Until now, only commercial banks could benefit from such protection—by getting dollars from the central bank at favorable rates. But there has been concern that many banks have not passed on these benefits to their clients.
“We’ve been having a facility at the central bank for banks that can come to us and we do what we call a forex swap—when we lock in a rate that they can come in one year, two years, and they will get the dollars at that rate and they pay us a premium,” Governor Hakuziyaremye said.
Now, BNR wants commercial banks to extend similar hedging instruments to their clients, particularly businesses that regularly rely on foreign currency to import goods, pay suppliers, or invest in international operations.
BNR Governor Soraya M. Hakuziyaremye spoke to KT’s Vincent Gasana
The governor said such tools are crucial for helping the private sector plan ahead, especially in developing economies where currency fluctuations can have major effects on trade and investment decisions.
“Local banks… are also developing those instruments that they can extend to the private sector and even individuals,” she noted. “That will probably make [foreign currency exchange] risk more manageable.”
BNR’s move is aimed at ensuring that businesses also gain access to that stability, by encouraging commercial banks to set up their own hedging services for clients, using the dollars they access from the central bank’s facility.
Why It Matters
Forex volatility has become a growing concern for Rwandan businesses, especially importers and exporters who deal in dollars and euros.
A rapid change in exchange rates can increase costs overnight and cause serious budgeting issues.
By locking in future rates, businesses can avoid surprises and plan better. This is particularly helpful for sectors like manufacturing, logistics, energy, and healthcare, where foreign payments are routine.
Similar hedging facilities are used in other countries like India, South Africa, Nigeria, and Kenya, where central banks or commercial banks offer forward contracts to help manage currency risks.
Rwanda Turns to Gold and Caution to Weather Global Turbulence
Beyond forex stability, the Governor also revealed that BNR is taking broader measures to shield Rwanda’s economy from global market shocks. One such measure is using gold as part of the country’s reserves, a strategy aimed at maintaining long-term financial security.
Governor Hakuziyaremye described herself as Rwanda’s “alarmist-in-chief”—always preparing for the worst so the country can stay resilient in uncertain global economic conditions.
This mindset has influenced BNR’s conservative and forward-looking strategies, including diversifying reserve assets and maintaining tight risk management policies.
“We’ve done a lot to make sure Rwanda is not easily impacted by global volatility,” she emphasized.
To hear the full conversation and learn more about how BNR is managing Rwanda’s economy in an unpredictable global environment, watch the full interview.
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