{"id":72832,"date":"2024-05-13T11:06:20","date_gmt":"2024-05-13T11:06:20","guid":{"rendered":"https:\/\/www.africa-press.net\/rwanda\/all-news\/africa-solidarity-fund-commits-to-extending-loan-guarantees"},"modified":"2024-05-13T12:07:43","modified_gmt":"2024-05-13T12:07:43","slug":"africa-solidarity-fund-commits-to-extending-loan-guarantees","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/rwanda\/policy\/africa-solidarity-fund-commits-to-extending-loan-guarantees","title":{"rendered":"Africa Solidarity Fund commits to extending loan guarantees"},"content":{"rendered":"

Africa-Press – Rwanda. <\/strong><\/span>Africa Solidarity Fund (ASF) has said it will expand its reach to provide robust loan guarantees as part of their commitment to reduce default risk for lenders, a move that will potentially unlock more funding for important initiatives.<\/p>\n

The Fund, which has already made pledges through several initiatives that enable lenders to easily loan to unique projects, made the commitment during a breakfast meeting held in Kigali on May 9\u201310.<\/p>\n

One such unique project is a recent decision by the Fund to start extending loan guarantee coverage by covering up to 80 per cent of the total loan with a ceiling of $30 million per project.<\/p>\n

Africa Solidarity Fund is a multilateral guarantee fund boasting 21 African member states that is dedicated to enhancing financial accessibility. The fundamental goal of the Fund is to bridge the gap in access to finance.<\/p>\n

With an emphasis on microfinance institutions, small and medium-sized businesses, and women in business, the first day of the breakfast workshop aimed to increase awareness and encourage collaboration among key stakeholders.<\/p>\n

On the second day, participants included representatives from the private sector, government officials, business owners, banks, and policymakers.<\/p>\n

In his opening remarks, Sallah Adade Emmanuel, the Head of Resident Mission of Mauritius at the Africa Solidarity Fund, said that their initiatives are reshaping access to finance in Rwanda and fostering business growth.<\/p>\n

\u201cIt\u2019s important to remember that the African Solidarity Fund can currently intervene up to 80% of the overall finance, with a $30 million maximum contribution per project. This illustrates our dedication to assisting worthwhile initiatives that promote wealth and economic advancement,\u201d Adade said.<\/p>\n

Higiro Innocent, CEO of MAICO Company and one of the beneficiaries of the ASF guarantee, said the fund saved him from financial troubles that were caused by the Covid19 pandemic.<\/p>\n

He encourages entrepreneurs with a collateral gap to join the initiatives.<\/p>\n

\u201cI would urge business owners to participate, particularly those who lack the necessary collateral to secure financing from a nearby bank, as it presents an opportunity for them to grow their clientele and obtain ASF coverage,\u201d Higiro said.<\/p>\n

Senior Investment Officer Allan Kinuka describes the African Solidarity Fund’s multiple intervention tools as well as how quickly the loan application process works when the entrepreneur is covered by the fund.<\/p>\n

\u201cThe processes required to complete the collateral can be time-consuming. However, because we step in in the event of a call within the following 30 to 45 days, provided all requirements are followed, the banker may rest easy knowing that the assets made available to his customer can be reconstituted very quickly thanks to the ASF’s guarantee.\u201d Kinuka explained.<\/p>\n

This, he added, gives banks a lot more ability to fund activities and development while enhancing their operational comfort and ability to fulfill customer requests.<\/p>\n

Solange Uwingabire, Head of Business Department at COOPEDU, understands that having an ASF meeting is important since the financial competition is very high but good enough that they are bringing bargaining rates.<\/p>\n

\u201cYou have to bargain where you see the maximum is 2.5 and the minimum is 0.5, depending on which guarantee you need. If you want a guarantee on your portfolio, you have to bargain, so compared with the Rwandan market, it is really favorable for us,\u201d she added.<\/p>\n

Hebert Asiimwe, Head of Financial Sector Development at the Ministry of Finance and Economic Planning, praised ASF for their offer and emphasized the significance of increased financial services as a vital sector for the development of the nation.<\/p>\n

\u201cAs a nation, we want to see more financial services provided to important economic sectors, but we can’t do this on our own with the limited financial resources found in our banks and MFIs. The most crucial point to make, though, is that we require the assurances offered by institutions and groups like the Africa Solidarity Fund,\u201d Asiimwe reiterated.<\/p>\n

Africa Solidarity Fund’s delegates during the two day workshop in Kigali. The Fund commits to extending loan guarantees<\/p>\n

Delegates pose for a group photo during the Africa Solidarity Fund’s two day meeting in Kigali. Photos by Christianne Murengerantwari<\/p>\n

One of the participants gives a comment during a breakfast meeting held in Kigali on May 9\u201310.<\/p>\n

The first day of the breakfast workshop aimed to increase awareness and encourage collaboration among key stakeholders.<\/p>\n

The meeting brought together different delegates including representatives from the private sector, government officials, business owners, banks, and policymakers.<\/p>\n

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