The Government of Rwanda has created a national oversight committee to guide the process of merging the Business Development Fund (BDF) into the Development Bank of Rwanda (BRD). The Ministry of Finance and Economic Planning announced the decision in Kigali, saying the aim is to improve efficiency in business financing and remove overlapping roles between the two institutions.
According to the ministry, the new committee includes representatives from the National Bank of Rwanda (BNR), the Ministry of Finance and Economic Planning, the Ministry of Trade and Industry, the BDF, and the BRD. The committee is chaired by BRD and will supervise due diligence, prepare an integration plan, and ensure a smooth transition.
The BDF was originally set up to support small and medium enterprises (SMEs), especially women, youth, genocide survivors, and people with disabilities, by providing loan guarantees and helping them access finance. BRD already owns 45 per cent of BDF’s shares and has now launched its own guarantee fund with support from KfW and the World Bank.
The Ministry of Finance explained that this integration is part of a bigger plan to centralise business financing and make better use of resources. It noted that BRD’s new strategic plan will make it easier for entrepreneurs to access loans by working closely with Savings and Credit Cooperatives (SACCOs) and private banks. However, it is still not clear if BDF will keep its current management, be dissolved, or have its role changed entirely.
The ministry assured the public that all existing agreements and guarantees will remain valid during the transition. The integration team has been told to maintain business continuity and avoid disruptions for clients. BRD Chief Executive Officer, Kampeta Sayinzoga, said it is too early to give detailed updates and more clarity is expected within two months. For now, BDF is still operational with its management and staff in place.
Officials believe that merging BDF into BRD will help to speed up loan processing, improve the use of digital tools, empower SACCOs, and cut down on bureaucratic delays. Currently, BDF offers a 50 per cent guarantee on most loans and up to 75 per cent for special groups, but many entrepreneurs say the process is slow and frustrating.
One of them, Dieudonné Niyodushima, Co-Founder of Exodus Farm Ltd, said it took him two years to get his loan approved because the requirements were given one after another instead of all at once. He suggested that BDF should give a full checklist of documents at the beginning to save time. Another entrepreneur, Clementine Mukandayisenga, who produces wine and juice from sugarcane and passion fruit, said she abandoned her loan application because the process took six to eight months. She also criticised the practice of treating purchased equipment as collateral, which later led to auctioning.
Parliamentarians are also watching the integration closely. MP Theogene Munyangeyo, Chairperson of the Parliamentary Committee on Economy and Trade, said the new system must ensure fair distribution of loans across all regions. He noted that in the past, some areas, especially rural ones, were left out, while large loans were concentrated among a few individuals.
An Auditor General’s report revealed that BDF had provided guarantees worth more than Rwf25.1 billion to 217 large enterprises, despite being created to focus on SMEs. Between 2011 and August 2019, this accounted for 51 per cent of its total credit guarantees. The report also showed that BDF’s policy allowed projects with capital investment ceilings of up to Rwf500 million, which contradicted the national SME policy limit of Rwf75 million.
Munyangeyo called for stricter controls and warned against scammers who have in the past impersonated BDF staff to collect money from loan applicants. He stressed that BRD must put proper checks in place to protect genuine entrepreneurs and restore trust in the system.
As Rwanda moves forward with this integration, the expectation from government, lawmakers, and business owners is that the BRD-BDF merger will finally solve long-standing challenges in loan access, remove duplication of roles, and help small businesses grow faster. The next two months will be crucial in determining whether the transition will deliver on these promises or simply create another layer of bureaucracy for the country’s entrepreneurs.
