Strategies for Rwandan commercial companies to be eligible to the Rwandan capital market

Abstract

This dissertation aims to contribute the debate on how to boost the funding of Rwandan commercial companies and those with high growth potential through the capital market and other external sources of finance than bank credit. In this regard, the Rwandan commercial companies have to fulfill the eligible conditions of the stock exchange, this require sustainable efforts for incorporation, for professionalism, for good governance and for performant management. The Rwandan government, CMA and RSE have a big role to create a well environment. The reflections on use of tax incentives play a significant role on these issues. The design of markets for small and medium capitalisation securities and the role of regulation are also substantial. The debate focused on how to overcome barriers which hinder the companies to access to the market for small and medium capitalisation securities. An exclusively national framework is not sufficient to guarantee the growth in these markets, because commercial companies have to deploy efforts to fulfill the requirements of the security market. This research has developed a strategic plan for the Rwandan commercial companies to be eligible to the capital market. In Methodology of this study, the descriptive research design was used. A self administered questionnaire well as follow up interview were held with CMA and RSE staff in order collect primary data. The purposive sampling was used to select the target of the population to obtain information. The Managers of company or their representatives have been selected on a simple random sampling, and snowball sampling to get data. The primary and secondary data were used to get information from the respondents through a structured questionnaire in interview schedule. The researcher analysed the eligible conditions of the stock exchange to highlight the constraints faced by Rwandan companies and the possibilities of commercial companies to integrate onto the capital market.