Kabuga, who gave his age as 87, was apprehended at his home outside Paris on Saturday after a quarter century on the run, having lived for years under a false identity.
His lawyers have insisted from the outset that he would challenge any attempt to extradite him to an international court.
Kabuga was indicted by the UN International Criminal Tribunal for Rwanda in 1997 on seven counts, including genocide.
The tribunal, headquartered in Arusha, Tanzania, formally closed in 2015 and its duties were transferred to the Mechanism for International Criminal Tribunals (MICT).
Serge Brammertz, the chief prosecutor for the MICT, told AFP that Kabuga is expected to be tried in Arusha if extradited.
It is possible he would first be transferred to the MICT's other branch in The Hague in the Netherlands due to travel restrictions during the coronavirus pandemic, Brammertz said.
On Wednesday, Kabuga was pushed in a wheelchair into a Paris courtroom that will evaluate the arrest warrant issued by the MICT and decide whether he should be extradited or not.
The court granted Kabuga's request for an eight-day postponement to prepare his defence.
"He wants to be tried in France, that is what he asked me to fight for," defence lawyer Laurent Bayon told the court.
Kabuga -- once one of Rwanda's richest men -- is accused of creating the notorious Interahamwe militia that carried out massacres, and the Radio-Television Libre des Mille Collines which, in its broadcasts, incited people to murder.
He is alleged to have used his wealth and influence to funnel money to militia groups as chairman of the Fonds de Defense Nationale (FDN) fund.
About 800,000 people -- Tutsis but also moderate Hutus -- were slaughtered over 100 days of ethnic violence committed by Hutu extremists in 1994.
Along with former defence minister Augustin Bizimana and top-ranking military figure Protais Mpiranya -- both still at large -- Kabuga was one of the three most significant suspects still sought for the mass slaughter.
Brammertz said international trackers were "motivated more than ever to find the remaining fugitives".
If the Paris court rules in favour of Kabuga's extradition, he can still take his case to France's Court of Cassation which would have two months to give a ruling.
French-Rwandan former hotel driver Claude Muhayimana is set to go on trial in Paris in February next year. He stands accused of transporting Hutu militiamen to sites where massacres were carried out.