Businesses and individuals are struggling to get their finances back on track as the government gradually put an end to incentives initiated to facilitate recovery from the pandemic.

It started with Rwanda National Bank (BNR) announcement in November that all loan relief and facilities put in place to support people who struggled with the loan payment, would be removed.

The decision came a few months after the government allowed the full operation of businesses.

Businesses say it was short notice and too soon. “I had been exempted from paying a small amount of money per month for my bank loan since early this year. It helped because business income was record low. I have not recovered the losses, but I have started paying back my loans. It was too soon,” Eustache Mutuyimana, a retailer in Remera, said.

The challenge is also faced by individuals who had taken loans, but their salaries were revised as their employers struggled to keep businesses afloat during the pandemic.

Now with little income and bank loans to pay, they are struggling to make ends meet.

Jean De Dieu Ndayisaba had taken a loan in a local commercial bank to buy a taxi motorcycle in 2019 to be paid back in two years. He has started paying back the loan but seeing where his business stands, he could have to sell back the vehicle and pay back the loan.

Rwanda’s infection rate has steadily remained 0.1 percent for the last month but increased to 0.2 percent in the second week of December.

Although some incentives and subsidies still hold, there are worries that given the current trend, businesses could suffer even more once they are phased off.

For instance, Rwanda had allocated a subsidy of $29.3 million in the 2021 financial year as a relief payment to hard pressed public transport operators.

If the subsidy is plugged off in the next financial year, transport prices are doomed to hike.

In the months of August and September 2021, Rwanda collected fewer revenues than expected because of some incentives and tax exemptions established to support businesses. According to the Minister of Finance, Uzziel Ndagijimana, Rwanda collected Rwf400.3 billion in taxes instead of the targeted Rwf410.9 billion.

In late November, the International Monetary Fund had called up some countries, including Rwanda, to “phase off” some subsidies to curb the growing debt.