World Bank Group has released a report that says supporting the greater financial system in Tanzania is crucial for the growth of the country's businesses and access to credit.
In less than eight years, an inexpensive mobile money-transfer system has given most Tanzanians the chance to take part in the mobile money revolution, according to the report, titled “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,” Bella Bird, the World Bank director for Tanzania, Somalia, Burundi and Malawi, said in a press release. “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.”
While most of the Tanzanian population lives in rural areas, banks are located primarily in three large cities, serving city dwellers and businesses.
“Financial development can make an important contribution to Tanzania’s development," William Battaile, World Bank lead economist and author of the report, said. "Supportive government policies and access to affordable credit are necessary to crowding in private investment, especially for the micro, small, and medium size enterprises vital for inclusive growth and poverty reduction."