> Posted by Jeffrey Riecke, Communications Associate, CFI

Rwanda has a lot to celebrate in terms of financial inclusion these days. Last week in Kigali the National Bank of Rwanda (NBR) hosted a conference in partnership with the World Bank, the African Development Bank, and the Alliance for Financial Inclusion (AFI) commemorating their 50-year anniversary. At the event, titled Financial Inclusion for Inclusive Growth and Sustainable Development, NBR Governor John Rwangombwa highlighted the country’s recent rise in access levels, from 48 to 72 percent between 2008 and 2012 across formal and informal providers. Rwanda now has the laudable goal of increasing this figure to 90 percent by 2020. To help it get there, on Friday the World Bank launched a $2.25 million program supporting key financial inclusion areas for the country.

Along with overall exclusion rates dropping from 52 to 28 percent over 2008 to 2012, formal services access increased from 21 to 42 percent during the same period, according to the 2012 FinScope Rwanda Survey. The new government goal of 90 percent access by 2020 is an extension of the country’s Maya Declaration Commitment of 80 percent access by 2017. Rwanda’s growth in formal access can be attributed to products offered by both banks and non-bank providers, like the country’s community savings and credit cooperatives known as Umurenge SACCOs. Over the past three years, Umurenge SACCOs have attracted over 1.6 million customers. Ninety percent of Rwandans live within a 5 km radius of one of the cooperatives. Countrywide, the number of MFIs, including Umurenge SACCOs, increased from 125 to 491 between 2008 and December 2013. Elsewhere in the sector, over the last three years, the number of banks increased from 10 to 14, the number of insurance companies increased from 9 to 13, and the number of pension providers increased from 41 to 56.

The NBR conference highlighted the role that technology has played in reducing exclusion rates in Rwanda and elsewhere in East Africa. During the “Innovation, Technology, and Financial Inclusion” panel session, the Central Bank of Tanzania Governor Benno Ndulu cited how technology-enabled services models have halved exclusion rates in his country in just a few years. In the mobile money space, both Rwanda and Tanzania are prioritizing interoperability among providers (see here and here). The two countries were the first in African to support mobile money-based cross-border remittances. Across the continent, Rwanda and Tanzania’s central banks and other AFI member institutions are part of the African Mobile Phone Financial Services Policy Initiative (AMPI). The coalition serves as a platform for knowledge sharing and developing best practices and solutions for mobile money policy and legislative frameworks.

Other conference topics included the synergies and trade-offs of financial inclusion, financial stability, financial integrity, and financial consumer protection. The value of timely, accurate, and complete data for measuring and working towards poverty alleviation was also discussed, in a session that included leaders from MasterCard, CGAP, Innovations for Poverty Action, and the United Nations Capital Development Fund.

The World Bank’s newly-launched support for Rwanda is through the Financial Inclusion Support Framework (FISF) program. The program is aligned with the country’s financial inclusion agenda, targeting areas including MSME finance, client protection, financial literacy, payment systems, and financial infrastructure. Operating in close collaboration with inclusion stakeholders, the initiative aims to improve services access, usage, and quality, especially for lower-income and underserved rural populations. The scope of the work will entail technical assistance, advisory services, and capacity building for policy, regulation, and infrastructure development.

For a closer look at inclusion in the country, check out MIX’s Rwanda Map of Financial Inclusion.

Image credit: AFI

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