Access to financial services by Rwandans has increased over the past four years.

The increased delivery of financial services at affordable services has been attributed to the entry of foreign banks, aw well as an increase in number of Savings and Credit Co-operatives Societies.

According to data released by National Bank of Rwanda, since 2008, the percentage of the population which can access both formal and informal financial services has grown from 48 per cent to 72 per cent this year.

The bank’s preliminary findings indicate that the percentage of adults, who can access formal financial services increased from 21.1 per cent in 2008 to 42 per cent this year.

Those accessing financial services informally make up 29.8 per cent of adult population in 2012 up from 26.4 per cent in 2008.

The Ministry of Finance and Economic Planning attributes the growth to the financial sector development programme that was initiated in 2008, to create a conducive environment for attracting foreign investors.

“We have had many foreign banks and micro finance institutions that offer many products to Rwandans, and this has been a stepping stone for this development,” said John Rwangombwa, the Minister of Finance.

According to the latest World Bank report on doing business in East Africa, Rwanda tops the region in the formulation and implementation of policies, regulations and incentives conducive for investment.

The country also maintained the position in the region in global competitiveness in the recently released results of the World Economic Forum survet.

Rwanda moved up from position 70 to 63 out of the 144 countries surveyed.

The “Murenge Sacco” programme introduced by the government has also played a key role in opening up the financial market.

Already 416 saccos have been established under the programme.

In the past three years, the banking sector has attracted big regional players, such as Kenya Commercial Bank, Equity Bank and the recent acquisition of 80 per cent stake of Rwanda Commercial Bank by Kenya’s I&M Bank.

The Kenyan banks have pushed competition, to the advantage of the locals as banks open branches across the country to attract more customers.

However, most of the banks are yet to penetrate rural areas. The increased access to financial services has also been credited to other products such mobile money transfer platforms.

“Due to competition from new entrants, even the traditional banks stepped up their operations by introducing new and more products, which is good for the private sector for doing business through access to credit,” said Robert Mathu, the executive director of Capital Markets Authority.

The government, however, said the “Umurenge Sacco” programme has been a milestone in serving the rural masses, always neglected by commercial banks.

“With government policy for the banking sector, the number of financial institutions will rise even above what we currently have, and this would boost business for individuals and the general economy,” added Rwangombwa.

Rwanda has eleven major commercial banks and three microfinance banks, and most of them are in Kigali. Total assets in the banking sector in the first half of this year increased Rwf1.08 trillion in December last year to Rwf2 trillion by June this year indicating an 11.4 per cent growth mainly due increased deposits and loans.

Total loans increased by 20 per cent from Rwf631.2 billion in December last year to Rwf757.1 billion in June this year, while deposits grew by 12.8 per cent from Rwf716.5 billion to Rwf808.4 billion.

Non-performing loans to total gross loans reduced to 6 per cent in June this year from 8 per cent in December last year with the total NPLs standing at Rwf45.3 billion against Rwf50.0 billion in June and December respectively.