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World Bank deems mobile money a success in Tanzania

In less than eight years, there has been extraordinary progress in bringing the majority of Tanzanians into the mobile money revolution, mostly by adopting an efficient, low-cost mobile money transfer system. Doing more to support the much larger, formal financial system is now critical for the growth of the country’s business sector and its ability to mobilise savings and gain access to affordable credit, according to a World Bank Group report, ‘Money within reach: extending financial inclusion in Tanzania’. “The mobile money revolution has made a tremendous impact on the lives of millions of people who can now send and receive money and thus save at low cost,” says Bella Bird, World Bank country director for Tanzania, Somalia, Burundi, and Malawi. “With more effort, the remaining one-third of Tanzanians could also have access. Access to credit through the formal financial sector, however, remains a critical constraint to the growth of the domestic private sector, and thus a constraint on growth and to poverty reduction.” Tanzania has 58 banks and a per capita reach of 2.5 bank branches and 6.4 ATMs per 100,000 adults. While most of the population live in rural areas, bank operations are concentrated in the country’s three largest cities and largely serve better-off city dwellers and formal businesses. From fewer than 200,000 subscribers in 2008, the total number of registered mobile money user accounts grew rapidly to 53.3 million by the end of February 2016, with 17.6 million active users conducting at least one transaction within a window of 30 days. The World Bank report shows, however, that greater efforts are needed to fully capitalise on these developments to reach all customers and expand access to credit to the private sector, enterprises, and entrepreneurs, including more women and young people. Read more

  • Thursday, 20 April 2017

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