A Rwandan taskforce consisting of officials from the justice, local government and internal security ministries, as well as the National Bank of Rwanda (often abbreviated to the French acronym BNR) and the directorate of Public Prosecution, has reportedly blamed the national police force for delays in the recovery of RWF 7.2 billion (USD 12 million) from microfinance borrowers who have failed to repay their loans. So far, RWF 22 million (USD 36,700) of the outstanding funds has been collected.
The taskforce called for MFIs to assist with the collection efforts by providing lists of defaulters to BNR and the Association of Microfinance Institutions Rwanda (AMIR), a network of 84 MFIs. Mr Karugarama said, “they should present evidence to the police and prosecution for legal pursuit. The technical team should establish the total amount—paid and unpaid—within three weeks for evaluation on March 21.”
The police are also reportedly investigating approximately 100 cases of embezzlement by staff of microfinance institutions (MFIs) that have resulted in losses totaling RWF 79 million (USD 132,000). Tharcisse Karugarama, the Minister of Justice, was quoted as having said that police “should put more efforts to implicate those who misused their offices leading the entities to run bankrupt. They should investigate former employees and managers of microfinance institutions accused of embezzlement as soon as possible [1].”
By John Howard-Smith, Research Associate
About National Bank of Rwanda (BNR): Founded in 1964, The National Bank of Rwanda (NBR) operates as the central bank for the country. Its purpose is to define and implement monetary policy, mint currency and supervise and regulate the foreign exchange market and financial institutions. It also operates the Securities Exchange of Rwanda. In 2009, NBR reported total assets of RWF 727 billion (USD 1.23 billion).
[1] allAfrica: “Stakeholders Meet Over Microfinance Defaulters”, http://allafrica.com/stories/201102240919.html
Rwanda Ministry of Justice: http://www.minijust.gov.rw/
Rwanda Ministry of Local Government: http://www.minaloc.gov.rw/
Rwanda Ministry of Internal Security: http://www.mininter.gov.rw/
MicroCapital’s Microfinance Universe profile: National Bank of Rwanda (BNR), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=The+National+Bank+of+Rwanda
Browse the MicroCapital Universe and add your entry to the wiki at https://www.microcapital.org/microfinanceuniverse/
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