HISTORICAL
BACKGROUND |
The 'Banques Populaires' of Rwanda which can
be considered as savings and loans' cooperatives
started carrying out activities promoting savings
and loans in 1975. The activities started as a
government project with the financial and technical
support of the Swiss Federal Government, a project
that enjoyed Government exoneration from duties
and taxes. From the time they were created, the
Banque Nationale du Rwanda (Central Bank) authorised
these savings and loans cooperatives to bear the
name "Bank". This project that was entitled
'Bureau d'Orientation des Banques Populaires du
Rwanda acted as a coordination centre for the
creation of 'Banques Populaires' in various parts
of the country. It later provided monitoring and
support for the 'Banques Populaires'.
The desired objective is to develop mass savings
and loans, to promote the economic and social
well being of shareholders, their families and
the community at large through mutual aid and
solidarity. These banks seek to attain this objective
in the following ways:
· By giving members the opportunity to
invest their savings with interest;
· By granting loans to members so as to
enable them to fulfil their economic requirements;
the loans being reimbursable according to pre-determined
terms that can be adapted to each different case;
· By enabling people who lack financial
means but are nevertheless honest and hardworking
to have access to small loans with which to fund
small income generating projects;
· By encouraging the spirit of local initiative
as well as agricultural and non-agricultural activities,
through careful utilisation of the savings generated,
within the mandate of the 'Banque Populaire';
· By teaching people to respect commitments,
the practice of saving, and foresight;
· By discouraging usurious rates of interest,
and speculation;
· By creating mutual confidence among members;
· By building up an indivisible and inalienable
cooperative fortune.
In 1986, the 80 'Banques Populaires' already
created grouped themselves into a national federation
known as the Union of 'Banques Populaires' of
Rwanda (UBPR) that took over the role and functions
of the Bureau d'Orientation des Banques Populaires
du Rwanda. However, two aspects remained the same:
Firstly, the Swiss continued to fund the activities
of the UBPR in the same manner in which they had
funded those of the 'Bureau d'Orientation'. Secondly,
expatriates managed the UBPR until 1992 as was
the case for the 'Bureau d'Orientation'.
The number of 'Banques Populaires' increased
so steadily that by the time of the War and Genocide
of 1994, there were 131 'Banques Populaires' located
throughout the country, comprising 380,000 members.
After the end of the 1994 War, the Rwandan-Swiss
Accords by virtue of which the Swiss provided
grants to the 'Banques Populaires' and through
which the Rwandan Government exonerated the 'Banques
Populaires' from paying duties and taxes were
not renewed.
Some statistics of the 'Banques Populaires'
as at 31st December 2001 and as at 30th June 2002
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ORGANISATION
STRUCTURE |
The 'Banques Populaires' are savings and loans
cooperatives. They carry out their activities
in keeping with universal cooperative principles,
and are subject to the Cooperative Law of Rwanda
of 1988. In their capacity as financial institutions,
the 'Banques Populaires' are also subject to the
law of 1999 governing the regulation of banks
and other financial establishments.
Each 'Banque Populaire' is an autonomous cooperative
governed by a Board of Directors and controlled
by a Monitoring Council elected by and from among
members of the Bank, who are themselves the sole
owners. The Board of Directors recruits a Manager
who oversees the daily operations of the Bank,
in particular the reception of deposits, as well
as withdrawals. However, the Board of Directors
retains the important responsibility of authorising
expenditure and approving loans.
All the 'Banques Populaires' are members of a
Union which is also a cooperative whose members
are the 'Banques Populaires'.
The Union is managed by a Board of Directors
and controlled by a Monitoring Council elected
by, and from within the General Assembly of Delegates
from the 'Banques Populaires', in which each bank
is represented by one member. The Union has the
task of ensuring the proper functioning of 'Banques
Populaires' and plays three major roles: the management
of liquid assets, technical support and the monitoring'of
'Banques Populaires'. In keeping with the statutes
of the Union and those of the 'Banque Populaires',
the latter receive instructions from the Union.
The Union's Board of Directors appoints a Managing
Director who is henceforth responsible for the
daily management of the Union.
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THE
MAIN PROBLEMS |
The 1994 War and Genocide resulted in the theft
of liquid assets of the 'Banque Populaires' amounting
to 700 million Rwandan Francs, and also resulted
in irrecoverable loans amounting to 1.5 billion
Rwandan Francs, either because the debtors have
since died or because they no longer have the
means to repay their debts and the guaranties
have since been destroyed.
CURRENT
ACTIVITIES |
a) External auditing
In mid-2000, the Central Bank sent two auditing
companies to the UBPR. One was to carry out the
financial auditing and the other was to perform
the strategic and organisational auditing. The
final reports played a large role in the elaboration
of the 2001 - 2004 action plan that the UBPR drew
up under the supervision of the Central Bank.
b) The technical assistance program of the
World Council of Credit Unions, WOCCU (Conseil
Mondial des Coopératives d'Epargne et de
Crédit)
With the financial assistance of USAID, the World
Council of Credit Unions (WOCCU) is implementing
a program to render technical assistance to the
'Banques Populaires' for a period of four years.
This program started in October 2000. It aims
at improving financial operations within the 'Banques
Populaires', as well as spreading the banks' activities
so that the greater majority of the Rwandan population
may have access to them.
c) Financial assistance from the World Bank
The 'Banques Populaires' benefited from a recapitalisation
grant from the Rwandan Government amounting to
US$ 5,000,000. These funds are included among
funds granted by the World Bank to the Rwandan
Government in order to help the 'Banque Populaires'
to reconstitute its capital. This capital was
lost during the theft of liquid assets from the
'Banques Populaires' during the 1994 War and Genocide,
amounting to Frw 700,000,000 as well as irrecoverable
loans amounting to Frw 1.5 billion before the
1994 War and Genocide caused by the death of debtors,
or inability of debtors to pay and destroying
of guarantees.
ACTIVITIES
OF THE 'BANQUES POPULAIRES' OF RWANDA |
· Management of sight deposits and short-term
investments by members using special account/savings
books;
· Management of current accounts;
· Management of home-loan accounts, loans
for solar energy equipment, retirement-fund and
other accounts;
· The granting of various types of loans:
housing loans, working advances to senior staff,
loans for agricultural, crafts, livestock rearing
and commercial activities, etc.;
· Management of external credit lines granted
by the World Bank, the African Development Bank,
International Fund for Agricultural Development
(IFAD) and other international Donors to facilitate
the granting of small loans in the framework of
poverty alleviation programs;
· Payment of salaries to civil servants
and employees of private companies in return for
a special fee;
· The awarding of pensions as well as social
security payments from the Caisse Social du Rwanda
(Social Security Fund) in return for payment of
a fee;
· Countrywide money transfers on behalf
of public and private companies in return for
payment of a transfer fee;
· Other banking activities.
PROJECTS
BEING UNDERTAKEN |
The 'Banques Populaires' of Rwanda received funding
from USAID to carry out computerisation of the
Union and the 20 largest 'Banques Populaires'.
This was in answer to the malfunctioning of the
integrated banking software GLOBUS which had been
installed in 1993.
The Union of 'Banques Populaires' received permission
from VISA INTERNATIONAL to issue credit cards
in the near future in collaboration with other
commercial banks in Rwanda through the Société
Interbancaire de Monétique et de Télé
(interbank society for electronic money funds),
in which the UBPR is a shareholder.
The 'Banques Populaires' of Rwanda are interested
in furthering their collaboration with WESTERN
UNION. The former have a large network based on
an ever-increasing membership and a soaring rate
of deposits, which makes the 'Banques Populaires'
the only financial institution that is capable
of serving a wide majority of the Rwandan population.
Attached to this document is a list of the 'Banques
Populaires', the number of members, the amount
of deposits, loans granted and location of loans
throughout the country, and telephone contacts
of those who have already received loans (as at
30th June 2002). For those banks that do not have
telephones, the Union of 'Banques Populaires'
has in each province of the country a Regional
Accountant equipped with a telephone and fax for
receiving information, as well as a Regional Delegate
who circulates using a motor-cycle in order to
distribute postal orders to the 'Banques Populaires'
and any other information sent by the Union. In
addition, the UBPR has a collaboration contract
with the National Post Office to utilise the EMS
speedpost. The National Post Office has just established
a postal service at each 'Banque Populaire'.
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