Home Agribusiness Rwanda: RAB, BK TecHouse sign agreement to streamline agriculture inputs distribution

Rwanda: RAB, BK TecHouse sign agreement to streamline agriculture inputs distribution

Regemanshuro (left) and Bagabe exchange documents after signing the deal. Photo: NewTimes

Access to agriculture inputs and other services will soon be easy following the signing of a deal between Rwanda Agriculture Board (RAB) and BK TecHouse, a subsidiary of Bank of Kigali, to digitise management of the supply chain of the national farmer subsidy programme.

Regis Regemanshuro, the BK TecHouse chief, explained that the ‘Smart Nkuganire’ platform will be an innovative tool to link and empower stakeholders involved in the subsidy programme that handles fertilisers, improved seeds, pesticides, mechanisation and small-scale irrigation technology, among other items.

Regemanshuro said once completed, the platform will be accessible to farmers via their mobile phones and the Internet. He said all financial institutions will be able to access farmer information generated through the system.

Dr Mark Cyubahiro Bagabe, the Rwanda Agriculture Board Director General, said the ‘Smart Nkunganire’ system will help address current challenges RAB faces in the execution of its mandate. RAB is charged with transforming the agriculture sector into knowledge-based, technology driven and market oriented industry, among others.

Improve access to agro credit

Dr Diane Karusisi, the Bank of Kigali chief executive officer, commended the initiative, saying it will enable financial institutions to access accurate information, a development that could trigger “strategic” lending to agriculture and help transform the lives of farmers through improved incomes.
Access to finance by the agricultural sector has remained a big challenge for farmers as many commercial banks considering the sector “risky”.

The agricultural sector contributes 33 per cent to the national economy and employs more than 72 per cent of the total population.

Despite its contribution to the economy, loans to the sector currently account for 7.4 per cent of the total loans, according to a recent report by Access to Finance Rwanda.

The situation is attributed to limited data to facilitate credit analysts in the assessment of loan applications from farmers.

Farmers, input dealers welcome the initiative

Farmers have welcomed the initiative, saying it will help improve efficiency in the handling of farm inputs.

This means that farmers will be able to receive inputs and plant on time and, therefore, increase yields, according to Evariste Mutibagirana, a large-scale banana farmer in Rwamagana District.

Xavier Baributsa, a horticulture producer in Nyakariro, is confident digitising the service could help boost farm production along the value chain.

New inputs distribution model

The new inputs distribution model is designed to boost transparency and efficiency in the delivery of fertilisers and other inputs across the country.

Under the new model, only eight private companies were contracted by RAB to import and supply fertilisers in the country under the government’s subsidy programme during seasons A and B (July 1, 2016 to June 30, 2017). The companies sell fertilisers through the Agro Processing Trust Corporation Ltd (APTC Ltd) that in turn distributes the fertilisers to farmers countrywide.

Farmers claim some fertilisers were previously illegally smuggled outside and sold in neighbouring countries.

Others say there was discrimination in the distribution of seeds due to lack of proper delivery channels.