Category: Business

According to the released financial statement, the lender’s profit reached Rwf10.2 billion , translating into an increase by 22% as at 30th September 2022 from Rwf8.3 billion of the same period last year.

Generally, the bank reported Rwf30.5 billion in net revenue before impairment provisions, up by 25 per cent year-on-year, supported by 20 per cent growth in net interest income and a result of a better product mix as well as a build-out of Non funded Income up by 47 per cent year-on-year.

In the period under review, operating expenses increased by 21 per cent year-on-year to Rwf17.5 billion, driven by investments in business growth and the continued deployment of technology to improve customer services and product lines.

Hence, the cost-to-income ratio was 57.8 per cent and the profit after tax during the period was Rwf6.6 billion, an increase of 22 per cent from Rwf5.4 billion in the third quarter of 2021.

The loan book and net advances to customers increased by 9 per cent to Rwf243 billion from Rwf222 billion at the end of 2021, whereas deposits held for customers and financial institutions increased by 7 per cent to Rwf350 billion from Rwf327 billion at the end of 2021, resulting in a loan-to-deposit ratio of 69.4 per cent.

In line with the strategy to efficiently deploy its capital, the bank made total financial investments of Rwf119 billion, an increase of 30 per cent from Rwf91.5 billion reported at the end of December 2021.

The Managing Director of I&M Bank, Robin Bairstow said that the lender registered steady growth in terms of customers in the third quarter of 2022 with an increase by 32% compared to last year.

The bank also saw improved efficiency in transactions with significant growth in digital adoption where 74 per cent of all customer-initiated transactions in the bank now go through digital channels, consequently driving improvements in efficiency and customer satisfaction.

I&M Bank Rwanda also rolled out ‘Ganza with I&M’ campaign where it supported clients’ projects, provided financial advisory services among others.

It was meant to provide funding to Small and Medium Enterprises to mitigate effects of COVID-19.

The bank also stayed close to clients in different parts of the country including Rubavu and Musanze to meet their needs.

Bairstow also reiterated the bank’s commitment to continue walking with clients to cope with barriers related to the soaring inflation.

I&M Bank (Rwanda) Plc began operation in Rwanda in 1963.

The group’s total assets also increased by 16.8% to Rwf1.6 trillion (US$ 1,602.2 million) compared to the same period last year.

Net interest income grew to Rwf67.3 billion; with net interest margin decreasing to 9.5% from 10.9% in 2021. As at June 30th, 2022, BK Group Plc was adequately capitalized with Total Capital to Risk Weighted Assets at 22.8%.

Among others, shareholders’ equity increased to Rwf 296.5 billion, up 9.4% while liquid Assets by Total Deposits stood at 45.4% as at June 30th, 2022 an increase from 41.6% in the same period last year.

BK Group Plc is the mother company of four subsidiaries including Bank of Kigali, BK General Insurance, BK TechHouse and BK Capital Ltd.

{{Subsidiaries’ performance}}

{{Bank of Kigali Plc}}

On the side of Bank of Kigali, net loans and advances increased by 10.6% to Rwf1.0 trillion (US$ 988.9 million), client balances and deposits increased by 19.6% to Rwf1.0 trillion (US$ 1,000.2 million)

The bank also served 422,513 retail customers and 46,648 corporate clients; expanded the Agency Banking Network to 3,853 agents and processed over 1.8 million transactions worth Rwf314.4 million.

As at 30th June 2022, the lender had 68 branches, 98 ATMs and 3,099 Point of Sales (POS) terminals that accepted most international cards including VISA and MasterCard.

Among others; retail clients’ balances and deposits reached Rwf288.1 billion, corporate banking clients’ balances and deposits were Rwf 743.4 billion as June 30th, 2022.

BK Quick now has over 20,066 new registered customers as at June 30th, 2022; and has disbursed over Rwf1.2 billion.

BK’s IKOFI wallet has also registered over 1,852 agro-dealers/agents and over 264,066 registered farmers as at 30th June 2022.

Commenting on the performance; Dr. Diane Karusisi, the Chief Executive Officer of Bank of Kigali Plc said: “Bank of Kigali Plc recorded good performance in Q2 & 1H 2022; our loan book has not grown in line with expectations but we are seeing improvement in asset quality reflecting post-COVID recovery which allows us to record a solid 1st half performance. We look forward to a greater second half of 2022.”

{{BK General Insurance}}

BK Insurance registered a profit of Rwf1.5 billion as at the first half of 2022 compared to Rwf1.2 billion registered in the same period last year, representing 28% growth in profitability.

Gross premium increased to Rwf4.9 billion in the first half of 2022 from Rwf4.1 billion in same period last year; reflecting a 21% growth year-on-year.

Total assets decreased by 28% y-o-y to Rwf21.4 billion in the first half of 2022.

{{BK TecHouse}}

BK TecHouse registered a sales revenue of Rwf574.4 million in the first half of 2022 compared to Rwf486.9 million in the same period last year; representing a 18% growth y-o-y.

As at 30th June 2022, BK TecHouse registered over 2.8 million digital consumers where 2.5 million are from Agri-Tech; 301 thousand from Edu-Tech and 13 thousand from civil society and religious organizations.

{{BK Capital Ltd}}

BK Capital’s net operating income rose to 383 million in the first half of 2022; a 54% growth from the same period last year due to increased trading on the Rwanda Stock Exchange and sustainable growth in the fund management assets under management.

The Assets under management (AUM) for the Fund management business have grown to Rwf26 billion in the first half of 2022; representing a 49.7% y-o-y growth mainly driven by net inflow in Aguka Unit Trust Fund, which continues to attract new investments based on its value proposition.

Within the Brokerage Business, BK Capital increased bond and equity trading due to an overall RSE turnover growth of 157% and 250% y-o-y in bond and equity, respectively.

Béata Habyarimana, the Chief Executive Officer of BK Group Plc has commended the four subsidiaries’ performance and expressed optimism for further improvements in the second half of this year.

“Great results from all our subsidiaries; I am happy with what the Group’s management team has done in the first half of 2022. Our shareholders and investors will be happy with the sustainability of the Group’s results and financial position. Our Net income increased by a significant 24.5% y-o-y, while our total assets increased by 16.8% y-o-y. We remain focused on delivering higher value for our shareholders and plan to report even better numbers the second half of 2022,” she said.

{{About BK Group Plc}}

Established in 1966, BK Group Plc is a group company registered with Rwanda Development Board (RDB) and licensed under Law No. 08/99. Bank of Kigali is the largest bank in Rwanda by Total Assets, with 32.2% market share as at March 31st, 2022.

The Group has a short-term credit rating of A1+ and a long-term rating of AA-, with a stable outlook, from Global Credit Rating (GCR). BK Group Plc is listed on the Rwanda Stock Exchange as well as the Nairobi Securities Exchange.

This means the two banks will now operate as a single entity named BPR Bank Rwanda Plc, with KCB Group as the majority shareholder with effect from 1st April 2022.

The combined bank will become the second largest bank in the Rwanda banking industry and gives KCB Group a stronger edge in deepening the ongoing Group strategy to scale regional presence.

Commenting on the development, KCB Group CEO and MD Joshua Oigara said: “BPR as we know it today has a lot of potential. The success of this business will build on our era of undisputed leadership in the market and contribute towards Rwanda’s economic success journey. I am confident that we can re-write Rwanda’s next chapter of development and economic growth.”

“The success of this integration now allows our customers to enjoy exciting retail and wholesale offerings and the wide branch network is an opportunity for us to roll out products and services to MSMEs and the rural community,” he added.

Subsequently, the BPR Bank Rwanda Plc Board has approved a new organization structure for the integrated entity which takes effect immediately subject to governance approvals obtained from the National Bank of Rwanda (BNR). Mr. George Odhiambo, a seasoned banker has been appointed as the Managing Director BPR Bank Rwanda Plc. George was the Managing Director of KCB Bank Rwanda.

“The structure has considered the necessity of smooth post-integration transition with minimal business and human capital disruption whilst retaining key talent resources as well as alignment to the KCB Group Structure for support and governance,” said Mr Oigara.

The new entity has a new trademark and registration operating as BPR Bank Rwanda Plc; a new approved organizational structure; aligned products and services for the market; integration of core banking system; credit process automation and rebranded branches and customer touch points amongst other deliverables.

BPR is a strong retail and SME Bank with the largest branch network in the sector and a long history spanning over 45 years in Rwanda.

The merger will provide current KCB Rwanda’s customers with access to a larger network of branches and agents across the country, while BPR’s customers will benefit from best-in-class digital capability, transactional banking solutions, trade finance expertise and international banking offering from KCB.

Picture a world without e-commerce. A world in which every purchase demands physical presence of the buyer; where one sets for the market with only hope that products will be available; where dear ones from afar cannot cherish us with presents; where parents and caregivers cannot get supplies without compromising on other responsibilities; where the busy have to spare time (and fuel) for shopping despite the activity not requiring their presence. That is a world without e-commerce.

Fortunately, our world is different. Shopping is faster, cheaper, convenient, and provides more choices to the consumer. How did we get here? Yvette, an e-commerce pioneer in Rwanda and the founder of {{[Murukali->https://murukali.com/]}}, takes us back to the challenges and solutions of the early days, and her business’s partnership with [{{Vanoma}}->https://vanoma.com/].

{{How did you come to start an e-commerce business?}}

I had the idea to start Murukali when I couldn’t find any place to order supplies for my family while on maternity leave. Back in 2015, mobile payments weren’t nearly as ubiquitous as they are today, and home delivery as a service was rare.

{{What was the idea, and what challenges did you face?}}

The idea was to make shopping possible from anywhere at the touch of a button. We wanted to make sure anyone could sort through quality-controlled products, pay, and have them delivered without leaving their home or workplace. While it might sound like a no-brainer today, this was 2015, and people were skeptical it could be done in Rwanda, to say the least.

Every new business faces challenges, but ours had them twofold. On one hand, we had to build an e-commerce business, but given the state of infrastructure, we also needed to build a logistics arm as well. It was a significant challenge, especially with capital allocation at that point.

{{What were the problems in delivery?}}

Delivery companies of the time were unreliable. For instance, one company opened up shop and left after a short time, some other companies would directly compete with us and steal some of our customers, and bureaucracy at the post office wouldn’t allow us enough flexibility and fast response to our clients’ needs. So in the end, the better option was to make delivery an in-house service.

{{How did the pandemic affect the business, and how did you manage?}}

The pandemic was a challenging time in many ways. During lockdowns, people turned to e-commerce for almost all shopping, and we saw around a 40% increase in business. That meant more people to serve, and this time they had fewer options and reliability was at a premium.

It was then that I came across Vanoma (Nisawa at the time). They were young people with a focus on delivery and a degree of professionalism I was yet to see in the business. The company had the technology to order a delivery online which significantly sped up our process and reduced room for human error. The drivers were also reliable and communicated problems to help serve our customers better. Vanoma has made the business a lot easier to manage since one can focus all resources on the e-commerce side of the business with added security that delivery is taken care of.

{{What would you tell sellers still reluctant to embrace e-commerce?}}

I would say e-commerce makes it much easier to promote and sell products. Many producers sell exclusively through their physical stores and partnerships with supermarkets. These stores can only market so many products, and with many suppliers available, conflicts of interest can arise. Predictably, when producers introduce new products, customers rarely notice. With e-commerce, it is a lot easier to advertise new products with even more control of the brand message. E-commerce also affords you a suite of digital marketing tools to connect directly to people. Through social media and other means, you can easily reach as many people as you like with the news and offers. Moreover, people can see product details and buy instantly from wherever they are.

In terms of sales, e-commerce brings more predictability. Things such as heavy rains and storms can easily cut the customer supply. This can be dreadful, particularly with fresh food sellers and bakeries where a day without sales means a whole inventory wasted. Rush hour traffic jams are also getting worse. If you consider numerous stops people have to make including dropping/picking up kids or going to the gym, it becomes clear that there simply isn’t enough time to shop conveniently. Put simply, sellers are missing out on customers just because of accessibility issues even on regular days. Online sellers can expect the same amount of orders regardless of weather or traffic conditions.

{{Where do you see the future of e-commerce in Rwanda?}}

I see a bright future for e-commerce in Rwanda. Some of the hardest challenges have almost completely been solved: mobile payments are ubiquitous and companies like Vanoma ensure a smooth delivery experience. There is untapped potential for youth employment and value creation for people of all levels of wealth. This is something I think businesses and the government can work together to bring to fruition.

Even though the sector has seen dramatic growth, we still need mindset shifts in order to involve as many people as possible. Out of habit, some people are yet to see the benefits in convenience and saving time that e-commerce affords. E-commerce customers through platforms like ours have a much wider selection of goods and prices. Sellers too could gain much from having their products listed online for anyone to see, not just the few that can make it to the physical store.

{{What advice would you give to aspiring e-commerce entrepreneurs?}}

As for all entrepreneurship, it is important to give yourself time. Results do not show up on the first day, and, in fact, they usually take years to materialize. When you’re starting a business, mute both the inner and outer critics for about five years and see where the journey takes you. Feedback is important, but a bias towards optimism is crucial, especially in the rough first days. As for e-commerce, a lot of work has been done to ease the business for both sellers and buyers. Experiment with many things, and see how your customers respond. E-commerce also evolves rapidly. It, therefore, pays off to keep an eye out for useful innovation from across the world.

The recent report of National Agricultural Export Development Board (NAEB) shows that Rwanda generated US$444.8 million (over Rwf447 billion) from agriculture in 2020/2021 fiscal year.

Apart from tea and coffee, fruits and flowers are among businesses generating huge returns in the country. Of the horticultural produce exported within the region in 2020, vegetables came on top with 62.5% of total earnings while fruits accounted for 37.25%. At the global market, earnings from vegetables stood at 37.49% while fruits accounted for 62.75%.

The figures reflect how agriculture presents huge opportunities with high returns and gives optimism that the country’s ambitions to promote agricultural exports are being achieved.

The Government of Rwanda continues to facilitate cross border traders through implemented measures and agreements with partner countries.

It is against this backdrop that Rwanda has signed trade agreements with member states of the Common Market for Eastern and Southern Africa (COMESA). The country also signed similar agreements countries from the European Union and East Africa among others.

All these agreements are expected to remove barriers restricting farmers’ access to markets, improve their livelihoods and enhance their contribution to national economy as well.

Considering the aforementioned agreements as well as high demand and profitability of horticultural produce, we thought it could be your turn to tap into available opportunities and become a millionaire.

This article elaborates some areas of investments in horticulture that could make 2022, the beginning of a new era for a prosperous future.

{{Passion Fruit}}

Passion fruit is an ideal product to grow on Rwandan soil.

Varieties grown in Rwanda are Passiflora edulis (Purple passion fruit) and Passiflora flavicarpa (Yellow passion fruit), Sweet passion fruit, Giant passion fruit, Banana passion fruit.

Passiflora Edulis (Purple passion fruit) which grows between 6 to 8 months in Rwanda is the most appreciated on the European market.

Demand for Passion fruit in the European market is estimated at about 375,300 tonnes per year, which translates to about $861 million every year.

As per report released by ‘Manufacturing Africa report’ recently in 2022, the export of passion fruit to the EU can fetch a gross profit margin of 48%, assuming a wholesale price of US$4840 per tonne.

This report also indicates that the transport costs to the EU is approximately US$1800/tonne if the exporters take advantage of Rwandair subsidized tariffs.

Jackson Mugisha, the CEO of Jacks Business Group, a company that works with investors to cultivate Passion fruits, says that the fruit is highly demanded on the market and promising to generate high profit.

“If you want to enter into the passion fruit business it is better to work with experienced companies/farmers that embraced best practices because it is more reliable,” he says.

There are other cooperatives like ‘Coopedush’ which works with many farmers to promote and generate returns from passion fruit business.

NAEB also says that Passion fruit is good crop promising to bring quick profit to the farmers.

Passion fruits mainly grown in Gakenke, Rulindo, Gicumbi, Musanze and Burera districts.

{{Chia Seeds }}

Chia seed is an organic product that has been farmed in Rwanda for the past four years. This is one of the few crops that a farmer grows with market assurance as farmers sign a contract with buyers before.

Chia seeds became widely popular in Rwanda after Bertrand Nkurikiyimana from Akenes and Kernels started this project in Ngoma in 2022.

The companies founded by Rwandan diaspora in Belgium and Zambia as an initiative to invest in homeland and contribute to national economy, Akenes and Kernels Ltd and Api organic Rwanda work with Rwandan farmers to grow the crop for exportation.

As the leading exporters of chia seeds in Rwanda, they first sign contracts with farmers as potential buyers.

One of the farmers who works closely with Akenes and Kernels, Fabrice Mukwiye said: “Chia seeds are profitable in a short period of time because their demand is high on the market.”

Between 800kgs and 1200 kgs can be harvested on one hectare. One kilogram is costs Rwf 3000.

They are used for various purposes prompting high demand in the European and Latin American market. Among the many benefits, Chia seeds helps with blood pressure and reduce the risks of heart diseases, to name a few.

Currently Chia seeds are grown in Kirehe, Bugesera, Kayonza, Nyagatare and Rwamagana districts.

{{Chili/hot pepper}}

Chili is in high demand on the European and Chinese market.

Some of the varieties grown in Rwanda are the Rwandan bird eye chili, Red chili, Orange chili, Yellow chili and Habanero.

According to the ‘Manufacture Africa report’, European demand for chilli is roughly 1.5 million tonnes per year, which translates to about US$ 2.7 billion, while China needs 78,500 tonnes at a value of US$56 million.

The same report showed that the export of Fresh Chili to the EU can fetch a gross profit margin of 49%, assuming a wholesale price of US$ 4,360/tonne.

The transport cost to the EU is approximately US$ 1,800/tonne if the exporters take advantage of RwandAir’s subsidized tariffs.

Chili Farmers in Rwanda, reveal they can easily expect half a million Rwandan Francs per week for every 21 Acres of Land farmed.

Some of small holder farmers are working with Gashora farms, the biggest Chili exporter in Rwanda that landed a deal to supply 50,000 tonnes of dried chili worth $100 million to China as local partners.

As per NAEB’s annual report for 2019/20, chili was produced on 881.2 Ha at different sites of Rwabicuma, Muyanza, Musha, and different scattered individual farms located in Ndengo sector of Kayonza district and Kabare sector, Nyagatare, Kicukiro, Bugesera and Rusizi district.

{{Macadamia Nuts}}

Macadamia presents a significant investment opportunity for export oriented investors servicing the global market.

A single Macadamia tree bears fruit in 4-5 years, and the profit becomes higher as it gets bigger, one single tree can bear between 50-75kgs.

A Rwandan Farmer that harvests 50-75kgs can expect the profit between Rwf17,500-26,000 in case a kilogram is sold at rwf350.

According to NAEB, there are two processing firms in Rwanda namely; Norlega Macadamia Rwanda Limited and Rwanda Nut.

Norlega Macadamia Rwanda Ltd supplies to local clients such as Hotels, supermarkets and RwandAir.

This type of crop is highly demanded globally and mostly exported to Kenya, Japan and Turkey. A kilogram is generally sold at US$10-20.
NAEB shows that Rwanda produces about 16,000 metric tonnes that generate US$30 million annually.

This nut is currently grown in the Southern, Eastern provinces and the southern part of Northern Province.

{{French beans}}

Fresh beans are a profitable crop for which there is a year-round demand. French beans from Rwanda are mainly exported to the United Kingdom, Belgium, France and Dubai.

At least 10 tonnes can be harvested on one hectare and sold at Rwf500 per kg.

NAEB says that processing of the French beans, including canning and freezing, has not yet started in Rwanda. This could be a good business idea and opportunity for investors.

The report released in 2020 by a Netherland based firm named ‘Traide’ indicated that Rwanda exported 451,000 tonnes of French beans in 2018 that the export continues to grow exponentially.

Gicumbi district in the Northern Province is the leading producer of French beans.

RITF has grown by leaps and bounds becoming a strategic platform through which major businesses from around the world have penetrated the Rwandan market. This is made possible through organizing Business to Business meetings as well as Business to Government meetings.

The event mainly showcases products in various sectors such as ICT, banking and finance, agribusiness, arts and crafts, infrastructure, Automotive and general trading.

The recent trade fair which took place from 9th to 30th December 2021 at Gikondo Expo Ground in Kicukiro District of Kigali City, attracted new participants including the East African Business Council (EABC) headquartered in Tanzania.

Speaking to IGIHE; the Executive Director of the East African Business Council (EABC), John Bosco Kalisa has shed light on reasons that attracted the council’s participation and anticipated outcomes.

Kalisa revealed that he has had plans to promote the council’s visibility through participation in different exhibitions held in EAC, which he hopes are being attained gradually.

Kalisa was appointed the Executive Director in June this year. Following his appointment, the council has participated in three regional exhibitions including the ones held in Tanzania and Rwanda.

“The participation helps me to make a step further towards fulfilling my pledge for citizens of the East African community. We also plan to attend more exhibitions in other EAC member states,” he said.

Kalisa went on to explain that creating room for increased investments in one of EAC partner states EAC is part of the council’s mandate.

The participation in exhibitions is also considered an opportunity to lure investors where it has started yielding good results. For instance, Kalisa explained, it has received different businesspeople interested to become EABC members that some of them have started filling forms preceding their admissions.

“Many people miscomprehend EABC as the bloc for large businesses only which is not true. Small businesses are not excluded. Every willing trader is permitted to join. This is the kind of mobilization we have been carrying out at this expo,” he said.

Kalisa further disclosed that the campaign in partnership with host countries has been fruitful evidenced through attracted new countries.

“EABC has conducted mobilization in partnership with Rwanda’s Private Sector Federation. You have seen that this expo has attracted Mozambique, the democratic Republic of Congo, Kenya and Tanzania. Such sensitization is usually a result of joint efforts between EABC and the host country,” he underscored.

EABC was established in 1997 with the mandate of representing and promoting the interests of the EAC business community, provide value-added services that enhance trade and competitiveness, and to participate actively and positively influence legal and regulatory formulation to improve the business environment.

It also seeks to reduce trade barriers in the region.

Commenting on his projections, Kalisa said that he has very challenging projections to take the council to greater heights and expressed optimism to have them achieved within his five-year tenure.

“If God grants me more days of life, I intend to raise the intra trade within EAC from 15% to 40%. It is a hard task to achieve but I believe that God will give me strength to make it happen,” he stressed.