An Analysis of the Legal and Policy Frameworks Governing Microfinance Institutions in Rwanda

ABSTRACT Today, microfinance is accepted as a necessary instrument for reducing poverty in Pwanda. As long as, the appropriate instruments are well used in a suitable legal framework, microfinance can help in strengthening the poor~ capacities~ to create jobs and to generate revenues on a sustainable basis. A National Microfinance Policy has been devised and adopted specifically for controlllng frauds and exploitative tendencies. This defines the orientations of microfinance and allows MFI5 to achieve the ultimate objective of this sector which is to contribute to economic and social development of Rwanda~ vulnerable pooi who are economically active either in rural or in urban areas. Whlls1~, the objective of the pollcy is to allow MFI5 to offer accessible intermediation financial services on a sustafriable basis and adapted to the need of the population, the effective implementation of this pollcy requires the development of a national strategy. This must clarify, in detai4 the role of every actor or dealer as well as describe their activities which must be accomplished with a pre-established calendar. It has to define the indicators of performance for measuring the success of each actor.