The government launched a financial literacy campaign about two years ago. The campaign also has a component on deepening the savings culture in the country. The initiative also seeks to enhance deposits to reduce dependence by commercial banks on foreign funds and ensure sustainable domestic sources of development finance.
Rwanda National Investment Trust (RNIT) was established by the government with a mission to promote and manage funds, including unit trusts, with a view to augment the domestic resource mobilisation. Unit trusts are types of collective investment schemes that pool money together from many investors who have similar investment objectives.
The pooled money is managed by a professional manager (RNIT in this case) who invests it in a portfolio of securities such as bonds, money market instruments and shares or other authorised securities. This also contributes to the expansion and deepening of the capital market. The first unit trust in the country, RNIT Iterambere Fund, was launched on July 12, 2016.
The Fund’s IPO raked in over Rwf1 billion and its net asset value opened at Rwf102 on subsequent sale, and is now at Rwf102.20 (as of Thursday December 30). Currently, the Fund is invested in a mix of debt instruments.
A unit trust such as the RNIT Iterambere Fund, which is designed for safety, liquidity and return, is able to give a good opportunity for asset diversification. As an open-end product, it serves to be a near cash product, which institutions, individual investors, co-operatives, staff fund associations, among others, can invest in.
Given the nature of markets currently, the fund portfolio has been constructed as a 100 per cent debt portfolio and as such has visibility of returns. Being low on risk and having visibility of an expected return above 9 per cent annually, it is able to reduce the overall portfolio risk and helps savers or investors to achieve diversification.
There is no limitation on how much one can invest in the fund, which is either by pooling in a lump sum or by opting for the systematic investment plan. This is an easy facility that helps regular income earners, for example, public servants, and private business operators, to invest a fixed sum regularly on a given date each month, that one can implement a saving plan.
The fund offers two investment options; income option for investors who need to get their income/return as declared periodically, with a minimum investment of Rwf100,000, and the reinvestment option for investors who want their declared income to be reinvested and the minimum investment is Rwf2,000. In both options, there is no maximum limit.
RNIT Iterambere Fund opportunities
RNIT Iterambere Fund provides for ongoing repurchase, which means unit holders can redeem their units either partially or in full by filling up a repurchase form for the purpose.
Since it is the fund itself that is buying back units on a weekly basis every Thursday, investors need not wait for matching counterpart or buy orders. In cases there is no change in bank particulars, the form can even be submitted by email.
The units will be redeemed at NAV less the applicable exit load and funds would be sent by bank transfer.
Repurchase requests will be accepted on every business day and considered for processing every Thursday (with applicable NAV of next business day) on an ongoing basis, commencing on March 16, 2017.
Saving and investing in the RNIT Iterambere Fund provides a disciplined, flexible and convenient way of saving with long-term investment gains.
As Rwanda embraces the spirit of Kwigira or self-reliance as a way of life and has consistently managed to sustain economic growth, it is equally important to sustain the enthusiasm underscored in this spirit and growth rate.
Investing in RNIT Iterambere Fund is an opportunity to the investors to benefit from the growth of the Rwandan economy as consumption sustains today’s life but investment sustains future for both individual and institutional investors. RIF is open-ended to serve that purpose.
The writer is the marketing, sales and public relations manager at
Rwanda National Investment Trust (RNIT)