Banking sector contributes little to Tanzania's economy, says BoT
Tanzania's banking sector contributes little to the economy despite its improved stability and continued growth, said Bank of Tanzania's (BoT) governor Benno Ndulu.Tanzania's banking sector contributes little to the economy despite its improved stability and continued growth, said Bank of Tanzania's (BoT) governor Benno Ndulu.
He stated in a recent report from the bank that the contribution of the banking sector to the economy accounted for only 2.36 per cent in 2012,
up from 2.2 per cent in 2011.
He believes this decrease "is partly due to the low level of access to finance by
most bankable population, whereas a rapid growth is being experienced in the financial system as a whole and in the banking sector in particular. Access to finance is still very low,"
he added, quoted by Tanzania Daily News.
that efforts have been initiated to address the situation, including launching a credit reference system and developing mobile financial services as well as agent banking.
In September, the BoT
licensed a new credit bureau – called Dun & Bradstreet Credit Bureau Tanzania Limited - in a bid to reduce the rate of loan defaults in the country. It is the second credit bureau to become operational in Tanzania.
BoT's Deputy Governor Juma Reli said in a press release that a lack of a credit reference system in Tanzania has been one of the major factors limiting access to credit, as “small firms and individuals borrow at high rates because of the high risks involved as lenders do not have information on their credit behaviours."
Benno Ndulu is optimistic that BoT's efforts should help the country reach
50 per cent of financial inclusion by 2015.