AFIRR – Access to Finance for Recovery and Resilience also known as ERF2, is a project designed by the Government of Rwanda (GoR) to support renewed investment for post COVID-19 economic growth. The total project funding is $257.50 million.

The benefits below shows the criteria:
$8M Microbusinesses credit line: To be implemented by BDF to provide loans to micro-businesses via PFIs, namely (SACCOs) and Microfinance Institutions (MFIs). This sub-component will finance loans for working capital and investments related to business expansion and new ventures in all sectors of the economy.

$37.5M Refinancing credit line: The refinanced option will be 35% of the facility at 5% for a tenor of 15 years with a possible grace period of 3 years. Eligible sectors will be specified by Government at a later stage.

Investment Line of credit (USD150 Million for 15 years with a 3 years’ grace period):

  • For small businesses (turnover < RwF500 million):
    The ERF 2 will be lending up to RwF500 million at an interest rate of 8%. They can access a BDF guarantee coverage up to 50% or 75%.
  • For Medium businesses (turnover >RwF500 million < RwF1 billion):
    This financing will be blended with ERF 2 participation of 60% at 8% interest rate and 40% of PFIs/BRD funds at market rate. This facility will be capped at RwF 2 Billion per company and a BDF guarantee coverage up to 50% guarantee.
  • For Large businesses (turnover > RwF1 billion):
    This financing will be blended with ERF 2 participation of 60% at 8% interest rate and 40% of PFIs/BRD funds at market rate. This facility is capped at RwF5 Billion and can access a BDF guarantee of up to 50%.

Working capital (USD10 Million for 5years with a 1 year’s grace period):

  • For small businesses (turnover < RwF500 million):
    The ERF 2 will be lending up to RwF300 million at an interest rate of 8%. They can access a BDF guarantee coverage between 50% or 75%.
  • For Medium businesses (turnover >RwF500 million < RwF1 billion):
    8% for any amount ≤ RwF300 Million. Blended: ERF 2 participation of RwF300 million at 8% and remaining part at Bank’s rate for any amount ≥ RwF300. They can also access a BDF guarantee coverage of 50% or 75%.
  • For Large businesses (turnover > RwF1 billion):
    Blended: ERF participation of RwF300 million at 8%. There is no BDF guarantee on this component. Large business with Working capital need of less than RwF300 Million, they will be served at the bank’s rate.

Implementation by BDF
$40M
Risk-sharing Facility: Partial Credit Guarantee and de-risking schemes with the objective of reaching SMEs in sectors most hit by the COVID-19 pandemic, as follows:

$30M
Partial Credit Guarantee Scheme: This sub-component aims at strengthening the operations of the BDF’s Partial Credit Guarantees (PCG) scheme to offset collateral requirements by PFIs to facilitate the SMEs financing. The guarantee window will have a coverage of 50% to 75% with a special treatment to the targeted groups mainly: women, youth, people living with disabilities, vulnerable survivors of the Genocide against Tutsi of 1994, and veterans will benefit a risk Coverage up to 75%.

$10M
Bridge Lending Window – BLW: To provide short-term lending to climatic shock-affected vulnerable SMEs. This window will also provide a backstop insurance mechanism to protect BLW’s capital from depletion. This will include reviewing eligible insurance products available in Rwanda, collaborating with an insurance broker to support the structuring and procuring of a backstop product, and working with the insurance companies to oversee payouts into the BLW following severe shock periods/scenarios.

How/where to access HATANA ERF 2
The funds are accessible through your respective commercial banks, BRD and BDF for micro-enterprises.

Who can access the funds?
The project will support viable and potentially viable businesses in all sectors with priority to Made in Rwanda and their value chains
• Construction Materials
• Agro-processing
• Textiles and manufacturing
• Other light manufacturing subsectors

For more info about the Fund, please download below
The AFIRR Project Implementation Manual

Under the new Strategic plan of the Bank, a new department in-charge of Special Projects and Infrastructure was created to cater for strategic projects that don’t fall under priority sectors of the Bank.

The Bank will primarily focus on financing projects that enhance rapid development of infrastructure as well as other strategic projects that will promote economic transformation of Secondary Cities and their respective population in partnership with the government and other stake holders on projects that act as catalysts for development of different parts and sectors of the economy.

The key sectors to be financed specifically include public infrastructure as well as strategic projects where the government needs financial institutions to come in and bridge the gap where necessary.

The Bank offers different products (including loans, equity, leasing, refinancing) and services (including advisory, capacity building and technical assistance) at a prevailing interest rate of 16% per annum.