The Government of Rwanda under the auspices of the National Bank of Rwanda (BNR), Ministry of Finance and Economic Planning (MINECOFIN) has partnered with Visa Inc. to roll out a nationwide financial literacy campaign to accelerate financial inclusion to targeted level— of 80 percent as per the Government 7-year programme (2010-2017). In 2008, financial inclusion stood at 21 per cent according to Finscope study and it is believed that the figure has gone up as a result of tremendous growth of the financial sector lately.
The launch gala jointly organized by the three institutions at Serena Kigali Hotel on Monday March 25 was well attended by dignitaries from both public and private sector and development partner institutions.
Unveiling the campaign, the Minister of Finance Hon. John Rwangombwa, the Governor of Central Bank Ambassador Clever Gatete and the resident representative of Visa Inc. in Rwanda Ginger Baker officially launched the ‘Financial Literacy Pocket Booklet’.
Over a million copies of the booklet have been published in both English and Kinyarwanda (national language), to be distributed to Rwandans through local government channels across the country and the financial institutions, including bank branches, insurance companies, Saccos and so on. In addition, the soft copy of the booklet can as well be downloaded on BNR, MINECOFIN and Visa Inc. websites.
Amb. Gatete said BNR is in talks with the ministry of local government to establish feedback mechanism such that over the years the financial literacy pocket booklet is kept updated.
The campaign is also packaged with other mass media tools such as; informative drama (play skits), outdoor displays, plus various electronic and digital media tools. Participants were treated to 10-15mins exciting play skit performance on access to financial services which will be shown across the country. In her speech, Ginger confirmed Visa Inc.’s support in rolling out the financial literacy campaign.
“Financial literacy will ensure that Rwandans have full information they need to enable them make informed choices,” she said, noting that information transfer (on financial services) throughout the campaign shall be done in an informative yet entertaining manner for purposes of effective communication.
With the launch of its Branchless Solutions, Visa Inc. is optimistic that financial inclusion and cashless settlements in all transactions will play a significant role in shaping global commerce and local economies.
Visa Inc.’s Branchless Solutions was launched in December last year and is being piloted only in Rwanda in the whole of Africa, which will enable clients to use mobile phones to carryout financial transactions including payment of commodities without holding cash.
Visa Inc.’s global scale, network and technology infrastructure enables it to provide local solutions, tailored to the needs of a particular country with or without advanced ICT infrastructure. Rwanda has one of the best ICT infrastructure, with fibre optic internet laid out across the country.
Financial Literacy a Prerequisite to Financial Inclusion
Financial literacy is a key factor in development of financial services in the country. Over the past five years, Rwanda has done extremely well on the supply side—in terms of developing the financial services landscape. According to the Finance Minister, total investment in financial sector over the last five years now stands at over Rwf153billion.
Additionally, the government has moved to ensure 100% inclusion of all Rwandans in the financial sector by vesting more resources in the development of Microfinance Institutions and Savings and Credit Cooperatives (Saccos). This has as well paid off; the MFI sector over the last year grew by 21 % and their total deposits also increased to Rwf6.5billion and total loans disbursed to Rwf42.5billion. Of the total 416 Umurenge Saccos at every sector, they registered Rwf22.5billion deposits as of end of last year and Rwf4.7billion in disbursed loans.
Still on the supply side, the financial sector has become more competitive and banks and insurance companies vying to extend their services closer to the people. Total bank branches have increased to 700 across the country. Total accounts in the banking system, according Ambassador Gatete have now increased to over 2 million and if you add those (accounts) of Saccos and MFIs there are more than 3million accounts in Rwanda’s financial system. The successful implementation of Rwanda Integrated Payment Processing System (RIPPS) is an important enabler in rolling out financial services across financial institutions. RIPPS has various components such as ATMs, Point of Sale (POS), Real Time Gross Settlement (RTGS), Automated Clearing House (ACH) and Central Securities Depository (CSD).
That said and done, as the Governor notes, there is need to concentrate on the demand side too. “We need people, we need clients, and for them to understand and buy-in easily, we have to train, we have to inform, we have to sensitize,” he said.
In this regard, the Minister thanked all partners who have supported the government in rolling out financial literacy campaign. He singled out Care International and Visa Inc. “I assure you government support whether financial-wise, policy-wise or being active on the ground so that we can together fight and eradicate this war of financial illiteracy,” he promised.
Cooperation is Key
To succeed in financial inclusion it indeed requires a lot of cooperation. Thus, in rolling out the financial literacy campaign it is important that interventions are coherent, effective and sustainable. BNR plans to roll out training of trainers throughout all local government structures in order to ensure that the campaign initiatives are sustainable.