The banking sector has approved loans worth 1.7 trillion Rwandan francs in the nine months leading up to 2024, an increase of 25% compared to the nine months of 2023.
The Central Bank of Rwanda (BNR) has announced that this has resulted in outstanding loans totaling R4.4 trillion by September 2024, as reported by the Monetary Policy Committee of the BNR last week.
The Committee also announced that unpaid loans in small and medium financial institutions increased to 581.4 billion by September this year.
The management of BNR emphasizes that this increase in borrowers reinforces the positive progress that the financial sector continues to make in both banks and small and medium financial institutions.
In general, the rate of bad loans is still very high, with non-performing loans in banks at 4.2% and 3.8% in small and medium financial institutions.
That rate of non-performing loans is still below the rate approved by the Central Bank of Rwanda of 5%.
BNR Governor John Rwangomba explained that banks and financial institutions currently have a lot of opportunities to increase their profits.
BNR emphasizes that the financial sector is stable and has the ability to cope with the economic crisis even though it still has some difficulties.
As of September, financial institutions’ ability to withstand economic difficulties was at the rate of 21.2% for banks and 30.8% for small and medium financial institutions, both of which are above the minimum rate.
