Kigali - Today on 7^th July 2022 at LODA office there was signed a Memorandum of Understanding between LODA and Village Enterprise Rwanda, the ultimate objective of which is to establish synergy to accelerate scalable poverty exit and graduation outcomes in line with Rwanda’s Vision to end poverty in the country.

Through a “result based financing” approach, Village Enterprise (a non-governmental organization striving for a world free of extreme poverty across Africa, where people have the means to sustain their families) joins hands with LODA and many other actors in the social protection sector striving for decent livelihoods of citizens of Rwanda.

Commenting on this partnership agreement, Mr. MWIZERWA Sylvère, the Country Manager of Village Enterprise in Rwanda, said: “The raison d’être of the just signed MoU between LODA and Village Enterprise Rwanda is to establish a fund aimed at curbing the extreme poverty rate from 16% to 0% in Rwanda. […]. We are still under the preparatory phase, setting up the ground, and we plan to make the fund operational starting from January 2023. For the two coming years, we are starting with 15 million USD”. He further explained the new funding approach in these terms: “The “Result Based Financing” is a new mechanism that is currently being used to collect funds from donors by which one has to first showcase what they’re capable of. Trial phases were done in Kenya and Uganda where they led to positive results, and this pushed us to introduce this mechanism to Rwanda. As of now, we have now launched around 1,000 small projects _a kind of 3-person project_ and we can observe positive change leading us to pursue this initiative. […]. We shall work hand in hand with LODA in the identification of the neediest beneficiaries”, he added on.

Speaking to the press, the Director General of LODA, Mrs. NYINAWAGAGA Claudine said that: “This agreement comes in to boost existing efforts in social protection programmes targeting to end extreme poverty by 2024 and continue reducing poverty. […]. Village Enterprise Rwanda comes in to join this battle to fight against poverty. The major challenge we often encounter throughout the implementation of these programmes is mind-set related as observed amongst beneficiaries who tend to always be dependent on subsidies. This might be associated to insufficient human resources to carry on sensitization activities towards all beneficiary households. […]. Not only Village Enterprise Rwanda brings in more funds, that we actually need, but also to bridge the existing gap with more specialized social workers. The latter shall undertake a close follow up towards the largest number beneficiary households and ensure that members change their mind-set in terms of social assistance, urging them to well grasp and exploit opportunities offered to them”.

It is expected that the funding basket will function in crescendo. “At the very beginning, Village Enterprise Rwanda injects in 15 million USD into existing social protection programme, but with a target to reach between 35 and 50 million USD in the next 6 years”, revealed the Director General.

By the “Result Based Financing” mechanism, it is believed that by tying funding to results, we can help make social programs more effective in solving the world’s most pressing issues. The guiding principle of this approach lies into “verified outcomes” (Revenue generated, Businesses launched, Increased income, Increased savings and assets).