Analyzing I&M Bank’s digital payment plan in Rwanda - TechGyant

Analyzing I&M Bank’s digital payment transformation plan in Rwanda

Analysing-I&M-Bank’s-digital-payment-plan-in-Rwanda

The digital transformation of financial systems in Rwanda is now one to watch as it drums up support and momentum on both an intentional and international scale. According to TechGyant’s analysis on closing the country’s financial inclusion gap, there is a huge potential to be unlocked with financial technology to innovate solutions for Rwandan consumers — backed by a wave of supportive regulations and state-sponsored reforms.

TechGyant can now confirm that Rwanda’s oldest bank, incorporated in 1963, I&M Bank, on Tuesday March 6, has struck a partnership deal with Network International, a global leader in enabling digital commerce across the Middle East and Africa. This undisclosed deal agreement, regarded by experts as promising, will go a long way in providing advanced digital payment solutions supporting the Bank’s efforts to boost the country’s financial inclusion strategy.

Track record of industry excellence

Boasting as the second-largest commercial bank in Rwanda with an extensive branch network across the country, the financial institution has always shown technological promise with its sweeping innovations and digital-first strategies as a leading player in the Rwandan banking sector. According to multiple sources accessed by TechGyant, Capital Finance International, a global journal reporting on business and finance, awarded I&M Bank as Rwanda’s best bank in June 2023.

Also read: Africa Business Heroes Opens Submissions for 2024 Edition

I&M Bank Rwanda is publicly listed on the Rwanda Stock Exchange (RSE) through an Initial Public Offering (IPO) and started trading in March 2017. According to the RSE Market Report as of today, March 7, the Bank’s stock (IMR) had on its equity counter outstanding offers of 307,600 shares between RWF43 – 45 and no bids as of the closing bell of the RSE for the day. However, this closing is lower than that of the Bank of Kigali (BOK) counter, which closed at RWF300 with a trading session that recorded a total turnover of RWF150,000 from 500 shares traded in 2 deals.

Analyzing I&M Bank’s digital payment plan in Rwanda

The long road to bridging financial inclusion gap in credit

What is now left to be seen is how this partnership will digitize and increase access to formal credit for the Bank’s customers’ financial inclusion beyond its promise of advanced digital payment products, robust security protocols, and a sophisticated Application Programming Interface (API) gateway.

Data earlier analyzed by TechGyant show only 22% of Rwandan adults have used formal credit, leaving them behind in boosting their consumer spending power and scaling their small and medium-sized businesses. This low formal credit adoption rate is dragging behind other financial services like payments and savings, which stand at 43% and 54%, respectively. This is also way behind credit-advanced markets in East Africa, such as Kenya, which has a 71% adoption rate.

Banks typically require financial consumers nationwide to show proof of formal employment, yet 90% of Rwandans are employed in the informal sector. For instance, GT Bank Rwanda’s ‘Max Advance’ loan asks for proof of at least six months of formal employment, while BPR Bank requires customers to receive salary into a BPR account.

As I&M Bank has a long history in banking and is a subsidiary of I&M Group, a leading regional financial services group in East Africa with presence in Kenya, Tanzania, and Uganda, TechGyant will keep an eye out to see if I&M Bank would replicate the success recorded in its other markets and analyze in-depth how its digital payment transformation plan will perform in the coming months.

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