Rwandan Government Subsidises Rural GSM Handsets

The Rwandan government has launched a scheme which subsidises the cost of mobile phones in order to expand their usage in rural areas. The scheme is being run by local GSM operator, MTN in association with the Rwanda Development Bank (BRD) and more than halves the cost of a handset from Frw28, 000 to Frw13, 000 - or about US$24.30 each. The average income per person in 2004 was US$204. As the cost of the handset is still equivalent to nearly a months wages, the owners are offered a micro-loan to pay for the phone over a period of 13 months.

The Minister in the Office of President in charge of Science, Technology, and Research, and Information Communication Technology, Prof. Romain Murenzi launched the initiative saying "This initiative of bridging the communication gap in rural Rwanda is one of key projects that are gradually coming to fruition,"

So far, over 53,000 handsets have been distributed under the scheme - to 15 out of the 30 districts.

Celestin Karabayinga, the mayor of Musanze District asked that the scheme be expanded due to demand: "People here have harvested and sold their agricultural products, thus can to afford buy phones. We'll therefore need more handsets,"

MTN already operates a micro-loan scheme which enables villages to buy a GSM based payphone service. In September 2006, the World Bank approved a US$10 million grant to Rwanda to develop its  information and communication technology market.

Posted to the site on 30th January 2008