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Serving rural areas big credit for banks
2007-05-30 08:35:22
By Editor
There were full-scale celebrations in Kahama last Saturday, as the National Bank of Commerce inaugurated a branch in the remote north-western Tanzania town, with most of those there to witness the event describing that as part of the bank’s exemplary role of supporting social and economic development in the rural areas.
Special commendation given on behalf of the government came from the Finance deputy minister Mustafa Mkullo, who said the expansion of the bank’s line of operations was sound because it would make its banking services accessible to more people in the area.
The bank`s Head of Retail Banking, Johan Vermaas, meanwhile said the opening of the branch was part of a continuous infrastructure expansion plan meant to open seven new branches around the country - most to be based in rural areas.
The planned expansion is heart-warming news and represents massive reform aimed at ushering in revolutionary changes, particularly to people living in far-flung rural areas until now not really enjoying banking services.
A substantial chunk of Tanzania remains unconquered by banks, one of the reasons for our social and economic problems.
Many studies, including one done by the Financial Sector Deepening Institute, show that only one-tenth of Tanzanians have bank accounts, meaning that a whole nine out of every ten of our people are yet to embrace banking as a way of doing business with.
According to the FSDI report, which was launched by none other than Finance minister Zakia Meghji, most of those who have chosen to stay out of the banking economy are found in the rural areas.
The minister used the launch to call for efforts to equip the citizenry with basic financial knowledge, saying anyone who still believes that banking is a luxury is hugely disadvantaged.
We believe that NBC’s move is in consonance with the minister’s call, particularly with regard to the need to search for more customers while also striving to tap the rural economy.
This is crucial because, if the facts be said, the rural dwellers are not to blame for their being bypassed banking services.
Time has come for more banks and other financial institutions to venture into the rural areas.
NMB Ltd, CRDB Bank, FBME and Exim are among those that have made some headway in that respect, but much more remains to be done.
The banking sector should have long seen this yawing gap as a setback in terms of curtailing or limiting their operations and therefore failing to help breathe enough life into the national economy.
NBC’s expansion should not start and end with the ongoing exercise of `financial deepening` but should be the happy new beginning of a more massive campaign to bridge the social and economic gaps between our rural areas and the outer world.
If more institutions join the struggle, the competition that development will usher in will surely be an important ingredient in the concoction our economy needs to become more buoyant for the good of us all.
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