Directive on Major Investments and Acquisitions of Deposit-Taking Microfinance Institutions

The Governor
DIRECTIVE No 47/2026 [613] OF 06/05/2026 ON MAJOR INVESTMENTS AND ACQUISITIONS OF DEPOSIT-TAKING MICROFINANCE INSTITUTIONS

THE NATIONAL BANK OF RWANDA;
Pursuant to Law n o
48/2017 of 23/09/2017 governing the National Bank of Rwanda as amended to date, especially in Articles 6, 6bis, 8, and 9; Pursuant to Law n o 072/2021 of 05/11/2021 governing deposit-taking microfinance institutions as amended to date, especially in Article 15; Pursuant to Regulation n o 60/2023 of 27/03/2023 determining prudential norms for deposit-taking microfinance institutions, especially in Article 16; Pursuant to Regulation n o 62/2023 of 27/03/2023 governing administrative and pecuniary sanctions applicable to deposit-taking microfinance institutions, especially in Article 5; ISSUES THE FOLLOWING DIRECTIVE:
CHAPTER ONE: GENERAL PROVISIONS
Article One: Purpose of this directive
The purpose of this Directive is to set up regulatory requirements for deposit-taking microfinance institutions’ acquisition of non-current assets and investments in shares of other companies.
Article 2: Scope of application
This Directive applies to deposit-taking microfinance institutions.
Article 3: Interpretation
In this Directive:
(a) “Central Bank” means the National Bank of Rwanda; (b) “major investment” means holding by a deposit-taking microfinance institution in an entity that represents at least 5% of the equity capital of the entity or a shareholding that exceeds 5% of the deposit-taking microfinance institution's core capital; (c) “major acquisition” means acquisition by a deposit-taking microfinance institution of non￾current asset that exceed 5% of the deposit-taking microfinance institutions core capital; (d) “non-current assets” means land, buildings, machinery, furniture, vehicles, intangible assets (software), and other equipment.

CHAPTER II: RESTRICTIONS ON ACQUISITION OF NON-CURRENT ASSETS AND
INVESTMENT IN SHARES OF OTHER COMPANIES
Section One: Restrictions on major acquisition of non-current assets
Article 4: Prudential limits
(1) A deposit-taking microfinance institution does not purchase or acquire any non-current asset or any right in it except as may be reasonably necessary for the purpose of conducting its business, such as offices or providing amenities to its employees. (2) Notwithstanding provisions of Regulation determining prudential norms for deposit-taking microfinance institutions, where a deposit-taking microfinance institution intends to acquire non-current assets for the purpose of conducting business or providing amenities to its employees that exceed 5% of the deposit-taking microfinance institution's core capital, it shall seek prior approval of the Central Bank. (3) The limitations of this Directive do not, however, apply to non-current assets acquired by the deposit-taking microfinance institution in recovery of a debt owed to it, provided that the assets are disposed of within a period not exceeding two years from the acquisition date.
Article 5: Application for approval of major acquisition
(1)A deposit-taking microfinance institution intending to make a major acquisition of non￾current assets for conducting business seeks prior approval from the Central Bank. (2)The application for approval shall contain the following information:
(a) Application letter to the Governor;
(b) Audited financial statements of the preceding year; (c) Approved business plan for at least three years; (d) Cost-benefit analysis; (e) Approved budget; (f)Minutes of the competent authority approving such acquisition; (g) The deposit-taking microfinance institution’s contingent plans to raise additional capital and liquidity in the event of the project’s cost overrun; (h) Any other relevant information the Central Bank may require.

Section 2: Restrictions on investment in shares of other companies
Article 6: Prudential limits
(1)A deposit-taking microfinance institution shall not make a major investment in equity shares of other companies without obtaining prior approval from the Central Bank. (2)The aggregate investment in equity shares of other companies by a deposit-taking microfinance institution shall not at any time exceed 25% of the deposit-taking microfinance institution’s core capital. For the purpose of this directive, the equity shares of the company shall include both ordinary shares and preference shares. (3)A deposit-taking microfinance institution may be allowed to have holdings in subsidiaries in which it has an absolute majority if the limits on aggregate investment in equity are observed and the investment is approved by the Central Bank. (4)The limitations of this directive shall, however, not apply to shares or interests in other companies acquired in satisfaction of a debt due to the deposit-taking microfinance institution, provided that it shall dispose of these shares or interests within a period not exceeding two years from the date of acquisition.
Article 7: Application for approval of major investment
(1)A deposit-taking microfinance institution intending to make a major investment in equity shares of other companies shall seek prior approval of the Central Bank. (2)The application for the approval of investment in shares of other companies shall contain the following information:
(a) application letter to the governor;
(b) approved business plan for at least three years; (c) cost-benefit analysis; (d) approved budget; (e) minutes of the competent authority approving such investment; (f) audited financial statements of the preceding year; (g) detailed documentation of the functions and activities to be undertaken by the company; (h) a detailed description of the investment to be made by the deposit-taking microfinance institution in the paid-up capital of the company; (i) a detailed description of proposed advances to the company or any other form of financial support intended to be provided; (j) a list of all other shareholders of the company;

(k) details that will allow the Central Bank to understand who the persons are that exercise effective control over the company’s operations; (l) The interrelationship of the deposit-taking microfinance institution and the company, covering the functions which will be performed by the deposit-taking microfinance institution for the company and vice versa; (m) The audited financial statements of the last three years of the company's operations; (n) Evidence that the company is duly incorporated and registered in the country in which it is domiciled; (o) Any other information the Central Bank may require.
Section 3: Application assessment and reporting
Article 8: Assessment of application for major acquisition of non-current assets
In assessing the application for a major acquisition of non-current assets by a deposit-taking microfinance institution, the Central Bank ensures that – (a) the acquisition does not undermine the deposit-taking microfinance institution’s management and financial soundness; (b) the acquisition does not jeopardize the interests of its depositors; (c) the acquisition does not hinder effective prudential supervision; (d) the acquisition does not expose the deposit-taking microfinance institution to undue risk; (e) the applicant deposit-taking microfinance institution is well-managed and is in compliance with the Central Bank prudential requirements.
Article 9: Assessment of application for major investment
In assessing the application of a deposit-taking microfinance institution, the Central Bank ensures that – (a) the investment does not undermine the deposit-taking microfinance institution’s management and financial soundness; (b) the investment does not jeopardize the interest of its depositors; (c) the investment does not hinder effective prudential supervision; (d) the investment does not expose the deposit-taking microfinance institution to undue risk; (e) the deposit-taking microfinance institution and each depository institution affiliate are well capitalized; (f) the applicant deposit-taking microfinance institution is well-managed and is in compliance with the Central Bank prudential requirements; (g) the investment does not hinder future effective implementation of corrective measures.

Article 10: Response to the application
(1)Upon receipt of a complete application, the Central Bank examines the application and communicates its decision to the deposit-taking microfinance institution, within one month. (2)The Central Bank may decide to – (a) Grant approval if it is satisfied that the application meets the requirements; (b) grant approval subject to the fulfilment of certain conditions that it may deem necessary; (c) Refuse granting approval.
Article 11: Reporting
A deposit-taking microfinance institution shall submit its portfolio of both major and non-major investments and acquisitions in accordance with the regulation and directive on reporting requirements.
CHAPTER III: MISCELLANEOUS AND FINAL PROVISIONS
Article 12: Administrative and pecuniary sanctions
Where a deposit-taking microfinance institution violates provisions of this directive, the Central Bank applies pecuniary and administrative sanctions as provided under the Regulation governing administrative and pecuniary sanctions applicable to deposit-taking microfinance institutions.
Article 13: Repealing provision
Any prior provisions of directive contrary to this directive are repealed.
Article 14: Entry into force
This directive comes into force on the date of its signature.
Done at Kigali, on May 06, 2026
Soraya M. HAKUZIYAREMYE
Governor