Top 10 Things You Need to Know About Banking Issues in Rwanda

Here are the Top 10 Things You Need to Know About Banking Issues in Rwanda, drawn from BPR Bank Rwanda, Patience Mutesi’s full interview with The Long Form Podcast hosted by Sanny Ntayombya.

Each point reflects a key insight, challenge, or underlying truth revealed by the BPR Bank Rwanda CEO — offering a realistic look into how Rwandan banking actually works, what holds it back, and what could shape its future.

1. Startups Are Chasing the Wrong Money

Mutesi made it clear that banks are not designed to fund startups. “Bank loans are not for ideas,” she said; explaining that banks protect depositors’ money, not experiment with untested business models. Early-stage businesses should instead seek grants, venture capital, or personal investment before approaching banks. Rwanda’s biggest gap, she argued, lies in the absence of a strong early-stage financing ecosystem, meaning entrepreneurs often approach banks too soon.

2. Banks Still Rely Heavily on Collateral

The Rwandan banking system remains heavily collateral-based, despite the rise of financial technology. Loan approvals are still dominated by the five Cs: character, capital, capacity, conditions, and collateral. Without tangible security, even a promising idea struggles to qualify. While this ensures stability, it also locks out thousands of viable small businesses that lack assets but have potential.

3. Many Businesses Fail Because of Cash Flow, Not Profitability

According to Mutesi, most loan defaults happen because businesses “look profitable on paper but don’t generate cash.” Profitability, she said, is often deceptive; “you can’t pay a loan with paper profits.” This highlights a persistent gap in financial literacy and management skills, where entrepreneurs focus on expansion instead of liquidity and repayment capacity.

4. Access to Finance Is Still a Structural Weakness

Despite Rwanda’s high financial inclusion rate of 96%, only 22% of that inclusion is through formal banking. The rest is dominated by mobile money and fintech platforms. This indicates that traditional banking remains out of reach for most citizens due to rigid requirements, limited physical reach, and a perception that banks serve only formal businesses and salaried employees.

5. The Human Factor Is Still at the Core of Lending

Even with automation, Mutesi emphasized that trust and integrity remain central in loan decisions. “We assess the person before the paperwork,” she said. BPR, like other banks, still depends on personal relationships and qualitative judgment. This human-centered system, while valuable, also opens space for subjectivity and inconsistency in lending decisions across banks.

6. Cybersecurity, Credit Risk, and Talent Shortages Are the Biggest Threats

The three issues that keep Mutesi awake at night are cybersecurity, credit risk, and limited talent. “You never know when a cyberattack will hit,” she said, admitting that even large banks are not fully prepared for sophisticated digital threats. She also revealed that losing one or two key people can disrupt operations, exposing how thin Rwanda’s banking talent pipeline still is.

7. Foreign Ownership Dominates — But Not Necessarily Control

While most Rwandan banks are foreign-owned, Mutesi insisted that decision-making remains local. “Ninety percent of our credit committee is Rwandan,” she said. However, she acknowledged that foreign ownership provides access to capital and technology that domestic investors cannot yet match. This dependence also means Rwanda’s financial system is vulnerable to external shocks or policy shifts from parent companies abroad.

8. Banks Are Playing Catch-Up with Telecoms

Mutesi admitted that telecom companies like MTN and Airtel now dominate financial access, offering faster, cheaper, and more flexible services. “Banks are no longer the face of financial inclusion,” she said. Only one in five Rwandans uses a bank directly, while the rest transact via mobile money. Banks are responding by digitizing, but telcos still control the mass market — especially for microloans and daily transactions.

9. Foreclosures Reveal the Emotional and Ethical Burden of Banking

Behind the numbers, Mutesi revealed that foreclosures are the hardest part of her job. “We don’t wake up to take someone’s home,” she said, adding that banks exhaust all restructuring options before seizing property. Yet, this admission also exposed a deep tension between compassion and obligation in banking; protecting one borrower could endanger thousands of depositors. It’s a moral dilemma that Rwanda’s banks face daily.

10. The Future of Banking Will Be Digital — But Rwanda Is Still Late

Mutesi conceded that Rwanda is “late to the AI story.” While automation is advancing, most banks are still transitioning from manual systems. She predicts that artificial intelligence will soon handle risk analysis, credit scoring, and customer service, freeing bankers to focus on strategy and relationships. But until then, the gap between Rwanda and more advanced financial markets remains wide.

Bonus Insight: Money and Personal Values Are Inseparable

In one of the interview’s most unexpected moments, Mutesi warned that financial failure often begins at home. “Your choice of life partner will make or break your financial success,” she said. She linked many loan defaults to family conflict and poor communication about money, urging Rwandans to normalize financial discussions early in relationships.

Patience Mutesi’s conversation offered more than just insight into BPR’s operations; it was a mirror of Rwanda’s broader financial landscape — promising but uneven, disciplined yet constrained.

The country’s banking system has achieved stability and digital progress, but access, innovation funding, and talent depth remain weak points. As Mutesi herself put it, prudence is not fear, and discipline is not conservatism; banking, she said, “is about protecting dreams, not gambling with them.”