New mobile banking service raises hopes of improving access to finance in Tanzania
A new mobile banking service has been launched in Tanzania by Covenant Bank.A new mobile banking service has been launched in Tanzania by Covenant Bank.
Executive Director Sabetha Mwambenja said that the launching comes at a time when the government is increasing efforts to reach those who are excluded from the financial sector.
"With this new service, called 'Benki mtaani kwako,' we hope to capture 1.2 million people in Dar es Salaam and 6.8 million others in other parts of the country," she explained, quoted by Tanzania Daily News.
The service allows users to transfer money to any other account and through any mobile phone network, as well as sending and withdrawing money from ATMs without a card.
"We believe that the best way of reaching the informal sector is through mobile banking," she added. Over eight million people in Tanzania are excluded from the formal financial sector and the country's banking sector contributes little to the economy, according to 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 explained that efforts have been initiated to address the situation, including launching a credit reference system and developing mobile financial services.
Benno Ndulu is optimistic that BoT's efforts should help the country reach 50 per cent of financial inclusion by 2015.