The East African country of Tanzania is best known for its vast areas of wilderness, national parks and the white-sand beaches of the
Zanzibar Archipelago. However, Tanzania also has one of Africa’s fastest-growing economies, with some interesting plans for further bolstering this growth.
Recent growth in Tanzania’s GDP was largely driven by agriculture, construction, and manufacturing industries. However, tight monetary policy, as well as moderation in food and energy prices, became key strategies in helping reduce inflation in the region between 2022 and 2023 (from 4.3 per cent to 3.8 per cent).
Financial Hub
Dar es Salaam
Key Economic Development Strategy
Tanzania Development Vision 2025
Economic, financial services and fintech overview
Tanzania relies on key exports such as gold, coffee, cashew nuts, and cotton, with gold contributing significantly to export earnings. The country aims to diversify its economy, transitioning to lower-middle-income status, with a robust annual gross domestic product (GDP) growth averaging seven per cent since 2000.
Initially characterised by a centrally planned economy, Tanzania nationalised all private banks between 1967 and 1992. Subsequently, private banks, including branches of foreign-owned institutions, have been permitted to operate, fostering a more dynamic financial services sector.
Although Tanzania’s fintech landscape is comparatively smaller than many other countries across the MEA region, notable progress is evident. Mobile money has played a pivotal role in driving financial inclusion, akin to other East African nations. Tanzania has experienced substantial growth in formal financial service adoption, with the percentage of citizens using such services rising from 16 per cent in 2009 to 65 per cent in 2017.
By June 2021, over 33 million mobile money accounts were active, indicating rapid expansion in account ownership. Additionally, the government’s promotion of Zanzibar, not only for its scenic beaches but also under the banner of ‘Silicon Zanzibar’ reflects efforts to attract tech talent to the region’s idyllic setting.
Fintechs in Tanzania include Azampay (offering payment management solutions), Mipango (providing financial management services) and Lokofin (a savings platform).
Key organisations
- Bank of Tanzania – The state-run bank operates as the central bank
- Capital Market and Securities Authority – The main market and securities authority
- Tanzania Insurance Regulatory Authority – Insurance regulator
- Tanzania Startup Association – An umbrella membership-based organisation which bring together stakeholders of startup ecosystem in Tanzania
- Tanzania Investment Centre – Main investment promotional agency of the country
Sector breakdown
Key fintech timeline
Tanzania has some key milestones pertaining to fintech as a whole:
- 1994 – Capital Market and Securities of 1994
- 2006 – Bank of Tanzania Act – Bank of Tanzania (BOT) regulator of financial services sector
- 2015 – National System Payment Act – department within BOT and deals with any fintech and reviews new financial technology products to be launched in the country
- 2015 – Tanzanian government established the ICT Commission
- 2021 – Tanzania introduced a new tax on mobile money transfer and withdrawal transactions (minus merchant, business and government payment transactions).
- 2021 – NMB Bank became an open banking pioneer and launched first fintech sandbox in the country
- 2022 – Success of government initiative ‘Silicon Zanzibar’ to attract tech talent from African to Zanzibar, with the launch of the Wasoko Innovation Hub in the region.
- 2023 – Bank of Tanzania issues draft regulations for a regulatory sandbox
Key statistics
This is an excerpt from The Fintech Times: Middle East and Africa (MEA) 2024 Report: read online
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