The adult population in the country has made positive strides and registered a shift in money management by embracing and using services offered by commercial banks and the so-called money shops in recent years.
Such spirit has lifted the people from the ‘far bottom cash-uncertainties oblivion’ where they used to wallow – to safer cash storage modes, thanks to the deliberate measures taken by the country’s vibrant banking sector to woo people from all walks of life to adapt to the saving culture.
It is gratifying to take grand note of the fact that the population has maximized use of the myriad of banking services by accessing the various products offered by 56 commercial banks both local and foreign established after the government liberalized the sector in the 1990s.
According to the World Bank (WB), Tanzania is the second largest country using mobile money accounts in Sub-Saharan Africa (SSA) with approximately 47 percent of its adult population, beating Uganda with which it recently shared the second position.
Kenya tops the list with a rate above the 58 percent against an average of 12 percent in SSA and merely 2 percent globally.
The situation tremendously improved following deliberate measures were taken by the Bank of Tanzania (BoT). The central bank initiated a sensitization plan in February 2016 that set a new financial inclusion target of 80 percent of the adult population using a financial access point by 2017.
This is after the country exceeded the target of 50 percent by 2016 under the National Financial Inclusion Framework (NFIF 2014/2017), with 55 percent financial inclusion in 2014.
According to the NFIF, the goal was beaten thanks to the mobile telephony technology with more than 35 million subscribers, which has extended the adult population’s financial inclusion to more than 50 percent with 16 million people using mobile money accounts.
In addition, the BoT also set targeted for the 2015/16 fiscal year, aimed at 70 percent of the population living within five kilometers of a financial access point by enhancing access and implementing access channels such as agent banking, further mobile financial services, point-of-sales (POS) and automated teller machines (ATMs).
Former BoT Governor Professor Benno Ndulu had said at the time that the central bank knew that by allowing the telecom sector to conduct mobile money payment services, it would serve as a good platform to improve financial services.
Therefore, authorities concerned decided to assume a ‘test and learn’ position that allowed mobile network operators to develop new services to review the risks later instead of establishing constraining regulations.
“This approach allowed BoT to test new mobile payment services in the market, observe the kind of risks related with them and regulate to improve bank services and also help them to expand their reach using mobile platforms, “the ex-governor added.
The partnership between mobile network operators and financial institutions has helped Tanzania to a position among the leaders in usage and access to affordable financial services in the world ranking 12th out of 21 developing countries in the world, according to the last Brookings Financial and Digital Inclusion Project (FDIP).
As the economic situation further improves, more employment opportunities are emerging, more adults will be employed and obviously access bank services and thus increase the population of adults and thus further position the country in a better place.