Cogebanque has signed a guarantee agreement with African Guarantee and Economic Cooperation Fund (FAGACE) in favour of a credit facility that Cogebanque has extended to Yego innovision limited, Rwanda, the company behind YEGOMOTO and YEGOCABS. The credit facility is earmarked for the implementation of its project to digitise the transport sector in Rwanda.
FAGACE, which will provide 50 per cent collateral, is an international financial institution specialised in the promotion of public and private investments.
The development the, the two institutions say demonstrates the commitment of FAGACE and Cogebanque to support the private sector in the implementation of projects and excellent cooperation relationships that exist between both financial institutions.
The latter follows similar agreement signed last year for the project of building and running a pharmaceutical plant in Kigali by Apex Biotech Ltd.
In the first phase, the facility from Cogebanque will enable Yego to equip 20,000 taxi-motos with Intelligent Connected Fare Meter (ICFM) to ensure the digitisation of the motorcycle taxi industry. Subsequent phases are planned to complete the roll-out to cover all 65,000 estimated taxi-motos in Rwanda.
The project will help streamline the motorcycle taxi industry and will provide various benefits such as: real-time speed tracking to help prevent accidents, regulated taxi fares, cashless payments, registered owners and drivers of motorcycle taxis, provide on-demand rides through the 24/7 toll free call center & App. Build a credit-score for the drivers by recording their income, and a big data platform to collect reliable statistics of the motorcycle taxi transport industry.
Speaking during the ceremony; Cogebanque CEO, Cherno Gaye, noted that it is yet another sign of the bank's unwavering commitment to finance a very important growing segment, that is the SME.
"There is a big drive from the Government to go cashless. This is really going to be in line with that direction. Transport is one of the priority sectors to be transformed. We are really glad and privileged to be part of this," he said.
Cogebanque CEO further said: "SMEs are the engine of the economy. It is difficult to provide financing for them and quite challenging because they have own challenges. Providing an answer requires financial institutions to be very innovative. One of the challenges SMEs face is access to collateral. For us as an innovative bank, we want to look for solutions that will help us to de-risk after identifying an SME that is really bankable and see how we can deal with the challenges to provide financing to them."
FAGACE Director General, Basile Tchakounte, said that the project was qualified for the guarantee because it meets all requirements in a sense that it is promising to create more jobs and help the government to streamline digitisation of tax and fee collection.
"Yego Innovision has a very innovative, game changing project for overhauling the transport sector and promoting employment which is why it qualifies for FAGACE funding. We are committed to boost the financing of SMEs in Rwanda. This is the second agreement signed with Cogebanque and hope for more fruitful cooperation ahead," he said.
Yego Innovision Ltd was established in Rwanda in 2016. The company launched Yegomoto in 2017, and ran the project as a "Proof-of-concept" from September to December 2017.
The platform uses a smart Intelligent Connected Fare Meter, that uses a GPS to calculate the distance travelled, after which the fare is calculated; the passenger can then tap the NFC tag on the meter to pay or pay via the App.
To help passengers claim back expenses, details of the journey including the pick-up and drop off points, the fare paid, the time taken and the mode of payment etc. are automatically sent as an e-bill via SMS and e-mail at the end of the trip.
Yego launched Yegocabs in September 2018, and has 1100 taxis operating in Kigali. Yego also launched a semi-automated dispatch platform with a call center, that operates 24/7. Passengers simply call the toll-free number 9191 and get a taxi in minutes. This enables passengers without a smart phone, data or even airtime to get a Taxi on demand.
Yego has also launched an NFC card based 'Ride-Tap-Pay' and has been recognised and awarded multiple times internationally, for its innovation, financial inclusion and world changing ideas.
The CEO of Yego Innovision, Karanvir Singh, said that the first phase of funds from Cogebanque will be utilised to provide meters to 20,000 taxi motos over the next few months.
"Our platform has been running since September 2017 and has been time tested. Most people in Kigali have experienced the difference that we have made to the licensed Taxicab industry. Our next goals are; first to complete the roll-out of 20,000 taxi motos, second to refresh the ageing fleet of taxicabs and third to usher in electric vehicles,"
"The average age of the taxicab is 22 years and the poor condition detracts from the experience of living or visiting the beautiful and clean city like Kigali. Our platform creates credit scores and as long as the drivers and passengers use the meter, they will help the driver get a loan to purchase a new car," he said.
Singh said that Yego Innovision has already invested US$ 7 million, but the entire project is expected to cost US$15 million.